Is Belgium Facing an Energy Crisis Due to Lack of Contract Management?

As widely reported in the news, Belgium is currently facing a significant risk of electricity shortages this winter. Following privatization reforms implemented several years ago, the Belgian government entrusted the private sector with a critical part of its national infrastructure: electricity production.

Today, six out of seven of Belgium’s nuclear power plants are offline due to concrete degradation issues and repeated technical incidents discovered over recent months. As winter approaches, the government fears power shortages, while energy prices are expected to surge as Belgium may need to import electricity from neighboring France and Germany.

What Does Contract Management Have to Do With This Crisis?

You may wonder why I’m addressing this issue on a contract management blog. After all, what does electricity production have to do with vendor management and contract governance?

In reality, this situation highlights a fundamental failure of contract management discipline. Whether managing IT service outsourcing or national energy production, both require diligent oversight of suppliers — particularly when the supplier operates at the heart of a nation’s strategic infrastructure.

Contracts Are Only as Strong as Their Oversight

While I’ve never seen the actual contract between the Belgian government and Engie-Electrabel, I have no doubt it was crafted by legal experts with detailed provisions. These contracts likely include numerous performance management clauses, financial monitoring mechanisms, and obligations designed to ensure proper maintenance — such as routine inspections of the nuclear plant’s concrete infrastructure.

However, even the most comprehensive contract cannot succeed without consistent execution. Regular supplier engagement, joint inspections, performance reviews, and corrective actions are essential elements of vendor relationship management (VRM). These practices ensure that both parties continuously monitor performance and proactively address issues as they arise.

Vendor Relationship Management: The Missing Link?

Vendor management isn’t just about signing a contract — it’s about governing that contract throughout its full lifecycle. This includes:

• Ongoing performance monitoring
• Collaborative issue resolution
• Scheduled maintenance oversight
• Risk mitigation strategies
• Transparent financial accountability

In situations where critical services are at stake, like national energy production, the customer (in this case, the Belgian state) bears responsibility for ensuring that governance frameworks are not only written but actively enforced. One must ask: were these processes fully executed? Did Belgian authorities perform ongoing supplier oversight to guarantee compliance?

Political Statements vs. Contractual Accountability

Recently, Belgium’s Prime Minister publicly criticized Engie-Electrabel for its handling of the nuclear power plant issues and called on the company to absorb future price increases. While this may sound reassuring — especially just days before municipal elections — it is highly unlikely to materialize in practice.

At the end of the day, Belgian consumers will likely bear the brunt of rising energy costs, due at least in part to deficiencies in applying basic but effective contract management and vendor governance practices.

Contract & Vendor Management: A Critical Discipline

At Unego, contract management and vendor relationship management are at the core of what we do. Every day, we advise clients on how to avoid common pitfalls that arise in managing complex service agreements. We specialize in:

• Contract drafting and negotiation
• Performance and financial monitoring
• Risk management
• Vendor relationship governance
• Process optimization through automation and AI

By combining proven processes with smart technology and expert human oversight, we help organizations maximize contractual value while minimizing supplier-related risks.

If you’d like to explore how Unego can help you or your company improve contract lifecycle management (CLM) and supplier governance, feel free to contact us:

info@u-nego.com

We would also love to hear your thoughts on this topic — feel free to reach out directly: Nuno Juromito