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Click to edit Master subtitle style Policies and measures to tackle energy poverty • Audrey Dobbins
Click to edit Master subtitle style
Policies and measuresto tackle
energy poverty
• Audrey Dobbins
2
• Approx. 50 million people in energy poverty
Estimates of energy poverty in Europe
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rce:
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. N
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. 4,
Iss
ue 1
0%
5%
10%
15%
20%
25%
30%
35%
40%
Share of EU population in energy poverty
Share of EU EP population (low) Share of EU EP population (up)
• Energy poverty proxy indicators – shareof population unable to keep comfortablywarm in winter
3
Introduction: What is energy poverty?
“A lack of access to modernenergy services. Theseservices are defined ashousehold access to electricityand clean cooking facilities(e.g. fuels and stoves that donot cause air pollution inhouses).” – IEA “the lack of adequate modern
energy for the basic needs ofcooking, warmth and lighting,and essential energy servicesfor schools, health care centresand income generation.” -Practical Action
The income point below whichenergy use and or expendituresremains the same, implying thisis the bare minimum energyneeds. – UNDP Energy poverty is defined as a condition
when average monthly householdexpenditures for the consumption ofelectricity, gas and heat, represent asignificant share of the average monthlyhousehold income. -Slovakia
A household to be fuel poor if (i) theirincome is below the poverty line (takinginto account energy costs); and (ii) theirenergy costs are higher than is Lowincome, high consumption (LIHC). Twocriteria include (i) fuel costs are above themedian level, and (ii) residual income netof fuel 14 typical for their household type.-UK
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Introduction: What is energy poverty?
“A lack of access to modernenergy services. These servicesare defined as household accessto electricity and clean cookingfacilities (e.g. fuels and stovesthat do not cause air pollution inhouses).” – IEA “the lack of adequate modern
energy for the basic needs ofcooking, warmth and lighting,and essential energy servicesfor schools, health carecentres and incomegeneration.” - Practical Action
The income point below whichenergy use and or expendituresremains the same, implying thisis the bare minimum energyneeds. – UNDP
Energy poverty is defined as acondition when averagemonthly householdexpenditures for theconsumption of electricity, gasand heat, represent a significantshare of the average monthlyhousehold income. -Slovakia
A household to be fuel poor if (i) theirincome is below the poverty line (takinginto account energy costs); and (ii) theirenergy costs are higher than is Lowincome, high consumption (LIHC). Twocriteria include (i) fuel costs are above themedian level, and (ii) residual income netof fuel 14 typical for their household type.-UK
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Access to modern energy services Ability to afford to meet basic needs
12.04.2019 5
Energy Poverty
Understanding energy poverty in Europe: drivers
Sour
ce:P
ye e
t al(
2015
)
• 3 key drivers of energy poverty (in isolation or combination):
• low income,
• high energy bills,
• poor energy efficiency
Commonly defined as a situation whereindividuals or households are unable toadequately heat or provide other essentialenergy services (e.g. mobility!) at affordablecost.
• Definition -> scope of the problem – identifies action areas andwhat is to be measured (indicator development)
• -> despite general consensus on the causes, there is noconsensus on the definition
BUT, what is meant by “adequate” and “affordable”?
European policy recognising energy poverty in combination withvulnerable consumers
Member States shall take appropriate measures to protect finalcustomers, and shall, in particular, ensure that there are adequatesafeguards to protect vulnerable customers. In this context,
each Member State shall define the conceptof vulnerable customers which may refer toenergy povertyand, inter alia, to the prohibition of disconnection of electricity to suchcustomers in critical times. Member States shall ensure that rights andobligations linked to vulnerable customers are applied. In particular,they shall take measures to protect final customers in remote areas.
Gas andElectricityDirectivesEU
Electricityand Gas
Directives(2009)
MemberStates
…but…
Review of definitions used across Member States
7
Energy povertyOfficial
definitionDefinitions
underconsideration...
Ireland, France,UK, Cyprus,Slovakia
Austria, Italy, Malta
Definition typeReceipt of social welfareRange of socio-economic groups(e.g., age, income, health)Energy affordability (low income/ high expenditure)Disability / health
Not available / Under discussion
Vulnerable Consumers
Source: CEER (2013); Pye et al 2015
…lack of guidance…
…but…
National/local context a strong driver of policy implementation
Energy poverty in the EUSteve Pye, 16.10.15
Differences across following metricsimpact on nature of problems, andpotential solutions
•Climate.
•Energy supply and use.
•Housing condition, type and tenure.
•State of market liberalisation.
•Energy prices.
•Household income & % households atrisk of poverty.
Due to all these differences, thedefinition should not include a metricbecause “affordable” and “adequate”will have different dimensions
BULGARIA• Partial liberalisation• Highest share of
AROPE• High share of space
heating, avg. centralheating
• High ownership level• Low elec prices, high
gas prices• Energy poverty not
recognised in policy
GERMANY• Market liberalised• Gas dominant central heating• Mod-high building efficiency• Moderate building data• Lowest home ownership level• High elec prices, mod. Gas prices• Energy poverty not recognised in
policy
Final energy consumption, based on Eurostat
What is a vulnerable consumer? What is energy poverty?What’s the difference? Why does it matter?
Electricity and gas vs.
Short-term curative approach vs.
Targets specific disadvantagedgroups
vs.
Main actors: regulator, consumerprotection agencies, utilities,government
vs.
Source: Dobbins et al 2019
• Main differences lie in thetypes of fuels included, theintervention timeframe, thetarget group and thedesignated implementingagent
• Do the definitions identify theproblem?
• Critical for action!
New EU Electricity andGas Directives(2019) Includedesignation for
vulnerable consumersand energy poverty,
but…
Impacts of energy poverty• There are short-term and long-term costs associated with inaction!
• Impacts on health leading to increased respiratory diseases, excess winter deaths, etc.• Impacts on economy and ability to achieve energy transition targets and objectives
Which measures do European countries use to address energyvulnerabilities?
Increasefinancialability of
households/ reduce
prices
Reduceenergy
consumption
16.03.2016, Audrey Dobbins
280 measuresreviewed across
EU-28
Financial Support(20%)
56 measures
Consumer Protection(27%)
74 measures
Info / Awareness(21%)
58 measures
Energy Efficiency(32%)
90 measures
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Financial supportoa crucial means of short-
term protection forvulnerable consumers.
oLargely distributedthrough the socialwelfare system to bothidentify recipients ofsupport and issuepayments.
oshort-term financialrelief should run inparallel to othermeasures
0%
5%
10%
15%
20%
25%
30%
35%
40%
Direct socialsupport
Energysubsidies &payments
Energysubsidies &payments(elderly)
Social tariffs Negotiatedtariff w/utility
Shar
e of
fina
ncia
l mea
sure
s re
view
ed, %
BE, CY, DE, ES,FR, GR, PT70% of financial measures
79% of Member States
Consumer protection
o focus on vulnerable consumerprotection, and are dominated bydisconnection safeguards
o diverse set of measures, primarilycoordinated by regulators andenergy supply companies.
o Many additional measures e.g.codes of conduct, debt protectionare often most prevalent in stronglyliberalised markets.
o Improves understanding of consumerrights and information on markettariffs
o Measures relating to pricecomparison and transparent billing,are often found in Member Stateswith the most liberalised markets.
o Where there is a strong civic societymovement in relation to energy orfuel poverty, the number ofawareness campaigns is higher.
14
0%
5%
10%
15%
20%
25%
Shar
e of
mea
sure
s re
view
ed, %
Information and awareness
Energy efficiency interventions
o key part of a strategy to address theunderlying cause of energy poverty
o considerable scope for increased andbetter targeting
o Long-term and short-term energyefficiency (benefits & potential risk ofincreased rents)
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Shar
e of
EE
mea
sure
s re
view
ed, %
Concluding remarks on addressing energy poverty in the EU context
Definition
Action
Barriers
ExchangeData
• A common definition is key – without this we see afragmented response, confusion and inaction
• Top-down leadership will help provide a strategy,mandate and budget, and coordinate differentresponsible government bodies and stakeholders aswell as bottom-up activities
• Countries can learn from each other’s experiences
• Solutions should build on addressing the underlyingcauses (lack of energy efficiency, inability to pay bills)and acknowledge that there is no one size fits allsolution; energy poverty is multifaceted, so amultipronged, cross-sectoral approach will be needed
12-Apr-19IER University of Stuttgart 17
EnerKey Lilliesleaf Action Plan recommendations for liveable buildings and aninclusive built environment
• Better living through better buildings: Newbuildings to comply with advanced energyefficient building standards; adaptedsolutions for low income households; beginwith passive energy saving measures beforeimplementing active technologies -> energyefficiency in policy development
• Appliances for modern living: Solar waterheaters and efficient lighting for higherincome households. Lower incomehouseholds switch to improved cookingstoves
• Integrative urban development:Empowerment of communities, developexemplary city quarters; engageneighbourhoods; combine living, workingleisure
oNo one size fits all solutions! Parallelmeasures to address various factors:affordability, efficiency, empowerment ofhouseholds through information andopportunities
o There are similarities in the types ofsolutions that will bring change
o There is a wealth of information and agreat opportunity to learn from each other,especially in terms of local innovation!
e-mailphone +49 (0) 711 685-
University of Stuttgart
Thank you!
12-Apr-19IER University of Stuttgart 18
Source: Kopatz et al. Energiewende, aber fair!
THANK YOU!
Audrey Dobbins
Institute of Energy Economicsand Rational Energy useUniversity of Stuttgart
audrey_dobbins
Source: Mark Lew
is
• https://www.nature.com/nenergy/volumes/4/issues/1
• http://meszerics.eu/pdf/energypovertyhandbook-online.pdf
• http://www.insightenergy.org/
Resources
IER University of Stuttgart 12.04.2019 19
Annual disconnections of electricity and gas across Europe
IER University of Stuttgart 12.04.2019 20
Source: Dobbins 2016
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Significant consumers of energy:
Households consumed ~28% of the final energy consumption in 2013. Together with personaltransport, households are responsible for almost 44% of final energy consumption.The majority of the household‘s energy consumption is for space heating (43%) followed by transport(37%)Households
Energy Transition
AGEB 2017, Destatis 2015, ADAC 2008
transport,37%
Spaceheating,
43%
Warmwater,10%
Cooking,4%
Cooling,3%
ICT, 2% Lighting,1%
Energy transition in Germany: households
Final Energy Consumption by sector, 2013 Final Energy Consumption for households by end-use, 2013
Households28%
Privatetransport
15%Othertransport
13%
Commerce16%
Industry28%
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Households key to successful energy transition by contributing to 2020 targets with:
Energy Transition
BMWI 2015
• +14% heating withrenewables
• +10% renewables intransport
• -10% electricitydemand (compared to2008)
• -20% heating demand(compared to 2008)
• -10% transport demand(compared to 2005)
Energy transition in Germany: targets
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
heating with renewables renewables in transport electricity demand heating demand transport demand
