Trust, Regulatory Design and the Evolution of EU Gas and Electricity Regulation

The European Union’s gas and electricity sectors have undergone major regulatory transformation since the late 2000s, combining increasingly detailed rules with mechanisms of continuous adaptation and revision. While existing scholarship explains this evolution through market integration, institutional development and experimentalist governance, it provides limited insight into the role of trust as a driver of regulatory change. This article argues that trust is the missing causal mechanism linking regulatory design and institutional adaptation in EU energy governance. Building on experimentalist governance theory, regulatory design scholarship and theories of institutional trust, the article develops a framework explaining how trust shapes two central dimensions of regulation: specificity (detailed rules versus principles-based approaches) and revisability (fixed rules versus adaptable frameworks). It argues that declining trust encourages greater specificity, oversight and control, whereas sufficient trust enables delegation, discretion and adaptive governance. Regulatory arrangements can, in turn, reshape trust by influencing perceptions of competence, fairness, accountability and institutional performance. Empirically, the article examines EU gas and electricity regulation between 2008 and 2022 through qualitative process tracing, tracing how trust assessments influenced regulatory choices and how regulatory outcomes subsequently recalibrated trust. The article contributes to experimentalist governance theory by identifying trust as the relational mechanism enabling recursive learning and regulatory adaptation, and to regulatory governance scholarship by showing that regulatory evolution involves both institutional learning and the construction and repair of trust.