As the threat of climate change continues to rise, society is put under an increasing pressure to produce less greenhouse gas emissions. However, the Netherlands is struggling to make progress in the energy transition, with only 8,6% of the final energy consumption being generated by renewables in 2019 (CBS, 2020b). To fix this renewable energy generation lag, it is crucial that a thorough understanding is created of how the energy system works, and what its drivers and barriers are. Among others, literature research shows that two of the biggest barriers for the generation of renewable energy are governmental policy as well as investments costs. The fact that governmental policy is one of the biggest barriers is extremely counterintuitive as it is also one of the biggest drivers. Furthermore, although renewable energy generation requires substantially high investment costs, other countries have been able to overcome this barrier, which raises the question as to why this has not yet been the case for the Netherlands. Due to their contradictory nature and their high level of influence, the decision was made to focus on the two barriers by researching the relationship between governmental policy and the investment climate surrounding renewable energy generation. This was done by analysing the effectiveness of policy instruments on the investment climate for two specific technologies, namely smallscale solar photovoltaics (PV) and thermal energy from surface water (TEO).