Invited talk by Dr Harriet Thomson to the European Economic and Social Committee

1. Energy poverty in Europe
and its relationship to the
Energy Union strategy
Dr Harriet Thomson
Professor Stefan Bouzarovski
Dr Saska Petrova
Dr Neil Simcock
University of Manchester

2. What is energy poverty?
When a household is unable to secure materially-
and socially-necessitated levels of domes6c energy
services (Bouzarovski and Petrova, 2015)
Core drivers include:
• Energy needs and prac@ces
• Affordability and ability to access cheaper fuels
• Efficiency of built fabric and equipment
• Household income
• Policy marginalisa@on

3. EVALUATE project
• Energy Vulnerability and Urban Transi@ons in Europe
(EVALUATE) www.urban-energy.org
• Five-year European Research Council funded project
• Aims to establish the driving forces of urban energy
poverty in the post-socialist states of Eastern and
Central Europe
• Mul@-scalar: ins@tu@ons, households, and buildings
• Mul@-methods: interviews, energy diaries, local
surveys, sta@s@cal modelling and more

4. EVALUATE: An urban
and neighbourhood
level approach
• Focusing on dynamics within
two inner-city
neighbourhoods, while:
• Exploring na@onal and city-
level processes
• Local support (Gdansk
University, Charles
University, CEU, CUW, Ss.
Cyril and Methodius
University)

5. A po?ed history…
• 1979 - Bri@sh civil servants iden@fied the issue
• 1991 - Brenda Boardman published her seminal book
• 2001 - Concerns first raised at the EU-level in an ECSC
opinion document
• 2003 - Explicit recogni@on given to household
customers in revised gas/electricity market direc@ves
• 2009 - Energy poverty given legal recogni@on in 3rd
energy package
• 2016 – ongoing Energy Union reviews, opportunity to
further incorporate energy poverty measures

6. UK (2001-2013):
“A household is said to be in fuel poverty if it
needs to spend more than 10% of its income
on fuel to maintain an adequate level of
warmth”
England (new LIHC 2013-):
A household is said to be in fuel poverty if it
1. has required fuel costs that are above
average (the na@onal median level)
2. were they to spend that amount, they
would be lec with a residual income below
the official poverty line (60% median
income)
Ireland (2016-):
“…a household that spends more than 10%
of their income on energy is considered to be
in energy poverty.”
(Department of Communica@ons, Energy &
Natural Resources, 2016: 8).
France (2009-):
A person is considered fuel poor "if he/she
encounters par@cular difficul@es in his/her
accommoda@on in terms of energy supply
related to the sa@sfac@on of elementary
needs, this being due to the inadequacy of
financial resources or housing condi@ons”
Slovakia (2015-):
“Energy poverty under the law No. 250/2012 Coll. Of Laws is a status when average
monthly expenditures of household on consump@on of electricity, gas, hea@ng and hot
water produc@on represent a substan@al share of average monthly income of the
household” (Strakova, 2014: 3).

7. Pan-European data context
• No dedicated survey of energy poverty
• Main data source is the EU Sta@s@cs on Income and
Living Condi@ons:
1) Ability to afford to keep the home warm
2) Leaking roof, damp, and/or rot in home
3) Arrears on u@lity bills in the last 12 months
• As well as Household Budget Surveys
• Provides actual expenditure data at na@onal level
• Not currently standardised across Europe

8. Core EU-SILC Index of Fuel Poverty (CIFP)
• Previous research has combined indicators at the
country-level to produce single composite scores
(Healy & Clinch, 2002; Thomson & Snell, 2013)
• The interrela@on of indicators at the household-
level is under-explored
• CIFP is a summa@ve index that adds up the
number of EU-SILC indicators reported, with a
possible range of 0 – 3
• First pan-EU household-level index of energy
poverty severity

9. CorrelaUons between EU-SILC indicators
• Moderate associa@ons between the core variables
• The fact they are not highly correlated suggests that
the variables are capturing different aspects of energy
poverty
U@lity arrears Leak/damp/rot Cannot afford warm home
U@lity arrears 1.00 .35 .47
Leak/damp/rot .35 1.00 .39
Cannot afford warm home .47 .39 1.00
Tetrachoric correla@on coefficient matrix of key EU-SILC indicators
Data: EU-SILC 2007 Cross Sec@onal
All correla@ons are sta@s@cally significant at the p < .001 level

10. Country
Number of indicators reported (% of households)
One Two Three
Austria 15.6 2.6 0.3
Belgium 20.2 4.0 0.6
Bulgaria 42.8 25.3 6.4
Cyprus 30.4 15.2 3.0
Czech Republic 15.5 2.4 0.3
Denmark 10.5 1.2 0.1
Estonia 22.4 3.8 0.6
Finland 10.4 0.9 0.1
France 15.8 3.4 0.7
Germany 15.4 2.7 0.5
Greece 26.8 8.8 2.5
Hungary 23.2 10.5 3.3
Ireland 19.4 4.8 0.8
Italy 23.2 6.3 1.6
Latvia 31.7 13.5 3.0
Lithuania 31.3 9.8 1.9
Luxembourg 16.4 0.8 0.0
Malta 22.1 4.8 0.3
Netherlands 16.3 1.6 0.2
Poland 22.2 7.6 2.3
Portugal 32.6 11.2 1.2
Romania 29.1 11.6 4.6
Slovakia 15.1 2.1 0.5
Slovenia 32.1 9.9 1.4
Spain 24.0 4.2 0.5
Sweden 11.1 1.2 0.1
United Kingdom 16.5 3.6 0.5

11. Country rankings - 2010
2010 Equal 2010 Severity
Finland 1 1
Denmark 2 2
Sweden 3 3
Luxembourg 4 4
Slovakia 5 6
Netherlands 6 5
Czechia 7 7
Austria 8 8
Germany 9 9
France 10 10
UK 11 11
Belgium 12 12
Ireland 13 13
Estonia 14 14
Malta 15 15
Spain 16 16
Italy 17 17
Poland 18 18
Hungary 19 20
Greece 20 19
Lithuania 21 22
Slovenia 22 21
Portugal 23 23
Romania 24 24
Latvia 25 25
Cyprus 26 26
Bulgaria 27 27
Key:
a = % of households repor@ng 1 indicator
b = % of households repor@ng 2 indicators
c = % of households repor@ng 3 indicators
Scenario 1 - Equal weighUng:
0.3333 a + 0.3333 b + 0.3333 c
Scenario 2 - Severity weighUng:
0.1667 a + 0.3333 b + 0.5000 c
• The CIFP has been compared with official UK
measures of energy poverty, and shows good
face validity, par@cularly with the 10% defini@on
• Posi@ve associa@on between income poverty
and CIFP, with a strong income disparity:
Number of CIFP indicators
Median disposable household
income (EU27)
0 €24,245.00
1 €17,000.00
2 €10,800.00
3 €8,073.00

12. Regions at risk
• 52 million + households in EU27
(Thomson, 2015)
• Reflects exis@ng regional structural
inequali@es (Bouzarovski and Tirado
Herrero, 2015)
• Southern, Central and Eastern Europe
most at risk of energy poverty
2010 Equal 2010 Severity
Finland 1 1
Denmark 2 2
Sweden 3 3
Luxembourg 4 4
Slovakia 5 6
Netherlands 6 5
Czechia 7 7
Austria 8 8
Germany 9 9
France 10 10
UK 11 11
Belgium 12 12
Ireland 13 13
Estonia 14 14
Malta 15 15
Spain 16 16
Italy 17 17
Poland 18 18
Hungary 19 20
Greece 20 19
Lithuania 21 22
Slovenia 22 21
Portugal 23 23
Romania 24 24
Latvia 25 25
Cyprus 26 26
Bulgaria 27 27

13. Regions at risk
• 52 million + households in EU27
(Thomson, 2015)
• Reflects exis@ng regional structural
inequali@es (Bouzarovski and Tirado
Herrero, 2015)
• Southern, Central and Eastern Europe
most at risk of energy poverty
2010 Equal 2010 Severity
Finland 1 1
Denmark 2 2
Sweden 3 3
Luxembourg 4 4
Slovakia 5 6
Netherlands 6 5
Czechia 7 7
Austria 8 8
Germany 9 9
France 10 10
UK 11 11
Belgium 12 12
Ireland 13 13
Estonia 14 14
Malta 15 15
Spain 16 16
Italy 17 17
Poland 18 18
Hungary 19 20
Greece 20 19
Lithuania 21 22
Slovenia 22 21
Portugal 23 23
Romania 24 24
Latvia 25 25
Cyprus 26 26
Bulgaria 27 27
Southern Europe:
• Whilst more temperate, indoor hea@ng is
required at various points throughout the year
• Poor energy efficiency standards
• Challenging macroeconomic circumstances and
prolonged fiscal austerity =
– Real loss of household income
– Cuts in financing for energy-related infrastructure
• High levels of dependence on imported energy in
island states of Cyprus and Malta
• Growing electrifica@on for indoor cooling and
appliances

14. Regions at risk
• 52 million + households in EU27
(Thomson, 2015)
• Reflects exis@ng regional structural
inequali@es (Bouzarovski and Tirado
Herrero, 2015)
• Southern, Central and Eastern Europe
most at risk of energy poverty
2010 Equal 2010 Severity
Finland 1 1
Denmark 2 2
Sweden 3 3
Luxembourg 4 4
Slovakia 5 6
Netherlands 6 5
Czechia 7 7
Austria 8 8
Germany 9 9
France 10 10
UK 11 11
Belgium 12 12
Ireland 13 13
Estonia 14 14
Malta 15 15
Spain 16 16
Italy 17 17
Poland 18 18
Hungary 19 20
Greece 20 19
Lithuania 21 22
Slovenia 22 21
Portugal 23 23
Romania 24 24
Latvia 25 25
Cyprus 26 26
Bulgaria 27 27
Southern Europe:
• Whilst more temperate, indoor hea@ng is
required at various points throughout the year
• Poor energy efficiency standards
• Challenging macroeconomic circumstances and
prolonged fiscal austerity =
– Real loss of household income
– Cuts in financing for energy-related infrastructure
• High levels of dependence on imported energy in
island states of Cyprus and Malta
• Growing electrifica@on for indoor cooling and
appliances
Central and Eastern Europe:
• Demise of communism brought about rapid and
substan@al restructuring to move towards a
market-based economy
• Measures included fiscal austerity, widespread
priva@sa@on, and deregula@on of the economy
• Income inequali@es and decreased purchasing
power
• Very poor housing stock quality
• Liberalisa@on of energy markets resulted in
removal of subsidies but without corresponding
safety nets
– Caused significant increases in the cost of hea@ng and
other energy services
– Issues of non-payment of u@lity bills

15. Energy poverty in post-socialist CEE
Czech Republic vs Hungary vs Poland
0%
5%
10%
15%
20%
25%
30%
35%
2005 2006 2007 2008 2009 2010 2011 2012
% households
PL
HU
CZ
Percentage of households spending more than 20% of their income on
domes@c energy (equivalised units), 2005-2012
Bouzarovski and Tirado Herrero (2016)

16. A domesUc energy affordability gap
Household incomes vs energy expenditures in Hungary
Domes@c energy price index, infla@on rate and rate of increase in earnings;
Hungary, 1992-2013
Purchasing
power gains
Domes@c energy
affordability gap
Bouzarovski et al. (2015)

17. Natural gas – a ‘price hike’
The growing per unit cost of an imported fuel
Price indices of main domes@c energy carriers, infla@on rate and rate of
increase in wages and pensions; Hungary, 2000-2013
Bouzarovski et al. (2015)

18. Further EVALUATE findings
• Energy poverty is complex and dynamic, varying
spa@ally and temporally
• Summer@me cooling is a significant issue
• Some households are switching to tradi@onal fuels,
such as firewood, as a coping mechanism
• Typologies that challenge no@ons of vulnerability:
• Short-term residents - ocen renters and in early adulthood
• Working age families - ocen in full employment and with
school-aged children
• Highly educated households in poor quality and/or
expensive housing

19. Moving forward - policy
• Need to recognise specific energy needs and all
energy services (especially cooling)
• Focus on other energy carriers, e.g. hea@ng oil
• Monitor MS vulnerable customer defini@ons
• Adopt a broad EU defini@on of energy poverty
• Include energy poverty in impact assessments
• Review & address gaps in 3rd energy package
• Holis@c approach, with focus on long-term
allevia@on via infrastructural investments

20. Moving forward - data
• Radically improve EU indicators to enhance
our understanding of energy poverty
• See Thomson and Snell (2014) for recommenda@ons
• Could include repor@ng requirements for MS and support
improved data mechanisms
• Increase technical and scien@fic capacity
• Promote data sharing and progression beyond
state-of-the-art:
• Data4Ac@on – good example of data sharing
• EUFPN htp://fuelpoverty.eu/findresource/ (350+ ar@cles)

21. Thank you
www.urban-energy.org |
www.fuelpoverty.eu
@harrimus
@stefanbuzar
@curemanchester

22. Further reading
• Bouzarovski, S., and Petrova, S. (2015). A global perspec@ve on domes@c energy depriva@on:
Overcoming the energy poverty–fuel poverty binary. Energy Research & Social Science, 10: 31-40.
htp://www.sciencedirect.com/science/ar@cle/pii/S221462961500078X
• Bouzarovski, S., and Tirado Herrero, S. (2015). The energy divide: Integra@ng energy transi@ons,
regional inequali@es and poverty trends in the European Union. European Urban and Regional
Studies, DOI:10.1177/0969776415596449
• Bouzarovski, S., Tirado Herrero, S., Petrova, S., and Ürge-Vorsatz, D. (2015). Unpacking the spaces
and poli@cs of energy poverty: path-dependencies, depriva@on and fuel switching in post-
communist Hungary. Local Environment, DOI:10.1080/13549839.2015.1075480.
• Thomson, H., Snell, C., and Liddell, C. (2016). Fuel poverty in the European Union: a concept in
need of defini@on? People, Place and Policy. Available at:
htp://extra.shu.ac.uk/ppp-online/fuel-poverty-in-the-european-union-a-concept-in-need-of-
defini@on/
• Thomson, H. (2015). Exploring the incidence and intensity of fuel poverty in the EU. Available at:
• htp://urban-energy.org/2015/07/02/workshop-report-fuel-poverty-and-energy-vulnerability-in-
europe/.
• Thomson, H., and Snell, C. (2014). Fuel Poverty Measurement in Europe: a Pilot Study. University
of York. Available at:
htp://fuelpoverty.eu/wp-content/uploads/2014/06/Fuel-Poverty-Measurement-in-Europe-Final-
report-v2.pdf