Regulatory sandboxes in the energy sector: are they key to the transition to a net zero future?

Regulatory sandboxes in the energy sector: are they key to the transition to a net zero future?

Alexandra Schneiders, UCL Energy Institute

Regulatory sandboxes are becoming a popular policy tool. They can play a key role in allowing for experimentation with new business models and roles enabled by net zero policies. This paper aims to assess whether sandboxes in the energy sector can play a key role in the transition to net zero. It reviews literature on the rollout of energy sandboxes so far, and focuses on the early movers, namely the Netherlands’ and United Kingdom’s sandboxes. The paper concludes that sandboxes can be a useful complementary tool to existing regulatory processes, as long as current limitations around their lack of representation of consumer interests, transparency, knowledge of experimenters, financial help, as well as short timeframes and inability to derogate from all applicable laws are addressed. These inhibit sandboxes from fulfilling their main aim; namely to enable stakeholders to learn from the challenges raised by a net zero future.