Energy poverty in the EU

Written by Dessislava Yougova

Two important studies on energy poverty in the EU were published in 2015 (see below), testifying to the importance of the problem on a European scale. According to the European Commission, around 11% of the EU population may experience energy poverty (see press release ). Energy poverty means that households cannot heat their homes adequately at an affordable cost. Although the problem exists across many Member States, it is a wide-spread reality in Eastern, Southern and Central European countries.

The current challenge for many Member States is to develop adequate definitions, which are useful for policy making and supported by the statistics. Defining the problem as important and distinctive means that particular policy strategy and actions are needed. The issue of fuel poverty was first conceptualized in the UK, but the terms ‘fuel poverty’ and ‘energy poverty’ are not always used as synonyms in the relevant literature. Experts also point out that the current Eurostat indicators are insufficient to identify where the problem lies. The relation between energy poverty and protection of vulnerable consumers, established in EU documents, should also be clarified.

A recent study requested by the European Parliament’s Committee on Industry, Research and Energy (ITRE), recommends policymakers to work towards ‘finding a definition of energy poverty, supporting national policies financially through EU coordination, and setting minimum standards for energy efficiency of buildings and devices’ .

EU legislation assigns the responsibility for protection of vulnerable consumers and addressing energy poverty to Member States. The role of the Commission is to support national measures by exchanging information and identifying available best practices and common indicators for assessing the problem on a European scale. In its Communication on a New Deal for Energy Consumers , the Commission outlines further policies that should lead to better ways to assist vulnerable consumers and especially those facing energy poverty. EU funding for energy efficiency improvements will continue to be available.

The European Parliament has a strong interest in the issue of energy poverty. Since the beginning of the current Parliamentary term, around 40 Parliamentary questions were put to the European Commission related to the topic. An EP own-initiative report on Delivering a New Deal for Energy Consumers is in preparation.

Reference studies

How to end energy poverty? Scrutiny of current EU and Member States instruments : study requested by the European Parliament’s Committee on Industry, Research and Energy, Öko-Institut e.V., October 2015, 88 p.
This study provides with general information on energy poverty in the EU, country specific analysis for 9 member states, and comparative analysis across the member states and EU.

Energy poverty and vulnerable consumers in the energy sector across the EU: analysis of policies and measures , May 2015, 91 p.
This study analyses the state of energy poverty across Europe and ways to combat it. It founds that the situation where households are not able to adequately heat their homes at an affordable cost is estimated to affect around 54 million people in Europe.
See also Appendices to main report , 48 p.
It contains country summaries and reports, as well as a list of research initiatives.

Recent analysis

Energy poverty in the EU: the state of the art

Energy poverty in the European Union: landscapes of vulnerability , Stefan Bouzarovski, in: Energy and Environment , Volume 3, Issue 3, May/June 2014, pages 276–289
According to this article energy poverty ‘can be seen as situation in which a household lacks a socially and materially necessitated level of energy services in the home’. The main conditions for this are ‘high energy prices, low household incomes, inefficient buildings and appliances, and specific household energy needs’.

Alleviating fuel poverty in the EU: investing in home renovation, a sustainable and inclusive solution , Bogdan Atanasiu [et al.], BPIE, May 2014, 56 p.
This study describes the current situation of fuel poverty in Europe using data from Eurostat to evaluate the extent of the problem. On the basis of case studies it analyses solutions and financial instruments and formulates policy recommendations.

Social justice and climate change: Addressing energy poverty at the European scale , Stefan Bouzarovski, article written within the frame of the Spring Alliance initiative ‘Tax justice and climate change’, supported by the King Baudouin Foundation, 2014, 8 p.
This article outlines some debates regarding the definition and driving forces of energy poverty at the European scale; the distributional aspects of the low-carbon transition and its implication for the energy justice; and the role of the ‘taxation’ issue.

Energy poverty in developed countries: European lessons for US, US lessons for Europe? , Jerrold Oppenheim, J.D., Theo MacGregor, Democracy and Regulation , International Association for Energy Economics: Energy challenge and environmental sustainability, Venice, 11 September 2012, 17 p.
This paper describes the Massachusetts Model to combat poverty through energy policy that helps meet the home energy needs, heating and electricity, of low-income households. It compares this model to similar efforts in other developed economies.

Energy poverty in the EU: a review of the evidence , Stefan Bouzarovski – Buzar, School of Geography, Earth and Environmental Sciences, University of Birmingham, 2011, 7 p.
This is a background paper for DG Regio workshop on ‘Cohesion policy: investing in energy efficiency in buildings’, Brussels, 29 November 2011. The aim is to understand the causes, content and consequences of energy poverty in the EU.

Energy poverty in Europe: Towards a more global understanding , François Grevisse, Marie Brynart, in: The eceee 2011 Summer Study proceedings , European Council for an Energy Efficient Economy, 2011, 13 p.
This paper compares and analyses the contexts of energy poverty, the consequences and the related policies in seven European countries: Belgium, Denmark, France, Hungary, Romania, Spain and United Kingdom. On this basis it discusses the advantages and disadvantages of a common and relative definition of energy poverty and highlights the problem of building general solutions.

Risks, conflicts and opportunities in the development of energy poverty alleviation policy under the umbrella of energy efficiency and climate change , Louise Sunderland, Darryl Croft, in: The eceee 2011 Summer Study proceedings , European Council for an Energy Efficient Economy, 2011
Drawing from experiences in the UK this paper considers the risk that energy poverty poses to the development of challenging demand reduction policies, the potential conflict between energy poverty reduction policies and carbon reduction policies, the tension between the need to keep fuel affordable and the cost of climate change policies, and the strong social driver that energy poverty provides for investment in energy efficiency improvement.

Defining and measuring energy poverty

A global perspective on domestic energy deprivation: Overcoming the energy poverty – fuel poverty binary , Stefan Bouzarovski, Saska Petrova, in: Energy Research & Social Science , Vol. 10, November 2015, pp.31–40
This paper aims at elaborating an integrated conceptual framework for the research and amelioration of energy deprivation in the home. It reviews relevant literature and questions different concepts and definitions in the context of developed and developing countries.

Energy poverty indicators: Conceptual issues. Part I: The ten-percent-rule and double median/mean indicator s, Rudolf Schuessler, ZEW Discussion Papers, No. 14-037, May 2014, 23 p.
This paper discusses existing approaches to measuring energy poverty and formulates propositions to ameliorate them.

Fuel Poverty Measurement in Europe: A rapid review of existing knowledge and approaches , study conducted for eaga Charitable Trust, Harriet Thomson, October 2013, 47 p.
This review outlines the range of approaches used to measure fuel poverty across Europe, and discusses the possibility to transfer them to different contexts. It also points out the definitional issues and terminological disparities at the European level.

Energy poverty alleviation and climate change mitigation: Is there a trade off? , Shoibal Chakravarty, Massimo Tavoni, FEEM, 2013, 17 p.
This paper proposes a model to quantify the number and global distribution of the energy poor, based on data and methodologies developed to study income distribution. It could be used for quantifying and mapping global imbalances.

Definitions of fuel poverty: Implications for policy , Richard Moore, in: Energy policy , January 2012, 8 p.
According to this paper the definition of fuel poverty is important in policy formulation to determine the scale and nature of the problem, and to target a strategy and monitoring progress.

Fuel poverty: Perspectives from the front line , Lenny Koh [et al.], Centre for Energy Environment and Sustainability, University of Sheffield, August 2012, 28 p.
This report overviews the history of the term of ‘fuel poverty’, its measurement and the implications for policy. It discusses different approaches and adds a new one, inclusive, stakeholder approach, which is required to understand successfully the fuel poverty. Finally, the report explains the future research directions to be explored as a result of this review.

Getting the measure of fuel poverty: Final report of the Fuel Poverty Review, John Hills, Department for Energy and Climate Change (UK), March 2012, 237 p.
This report concludes that the ‘fuel poverty’ constitutes a distinct and serious problem which needs a relevant strategy. It assesses its causes and impacts and proposes an alternative approach to measurement.

Statistics

Eurostat

Statistics on Income and Living Conditions (SILC):
– Inability to keep home adequately warm
‘Keeping home adequately warm’ is one of the nine deprivation items agreed by EU to measure economic strain, and consequently material deprivation (MD). It calculates the percentage of persons in the total population and in the relevant household type and income group breakdowns who are in the state of enforced inability to keep home adequately warm.
– Share of total population living in a dwelling with a leaking roof, damp walls, floors or foundation, or rot in window frames of floor
– Arrears on utility bills

Publications

Fuel poverty measurement in Europe , EU fuel poverty network, 2014
This post discusses the availability and quality of existing data for measuring fuel poverty at the EU-level, as well as the key outcomes of a pilot survey. Data from 2010 and 2011 shows that across the EU as a whole, nearly 10% of the population are unable to keep their home adequately warm, almost 16% live in homes that are damp, rotting or leaking, and around 9% are behind on payments for utility bills.

Annual Fuel Poverty Statistics Report , DECC (UK), 2015
The aim of this publication is to provide a comprehensive view of the latest statistical trends and analysis of fuel poverty in England. Fuel poverty in England is measured using the Low Income High Costs indicator.