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Utility payments in Ukraine: Affordability, subsidies and arrears

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  • Fankhauser, Samuel
  • Rodionova, Yulia
  • Falcetti, Elisabetta

Abstract

The transition from a planned economy to a market economy has caused considerable hardship for the people of Eastern Europe. One important aspect of the social costs of transition is access to, and the affordability of, basic services like electricity, heat and water, which under communism had been supplied fairly cheaply and abundantly. This paper provides evidence on this issue from the Ukraine Longitudinal Monitoring Survey (ULMS). The paper identifies considerable differences in both access and affordability between different localities in Ukraine. Social protection measures can help to alleviate affordability constraints, but the analysis finds that social support is not well targeted. The currently low tariffs prevent an escalation of affordability problems but constraints nevertheless exist. Many households have accumulated substantial arrears as a consequence, although non-payment is a complex issue and not solely a function of affordability.

Suggested Citation

  • Fankhauser, Samuel & Rodionova, Yulia & Falcetti, Elisabetta, 2008. "Utility payments in Ukraine: Affordability, subsidies and arrears," Energy Policy, Elsevier, vol. 36(11), pages 4168-4177, November.
    • Handle: RePEc:eee:enepol:v:36:y:2008:i:11:p:4168-4177
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    References listed on IDEAS

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    1. World Bank, 2005. "Ukraine : Poverty Assessment, Poverty and Inequality in a Growing Economy," World Bank Publications - Reports 8803, The World Bank Group.
    2. Dodonov, Boris & Opitz, Petra & Pfaffenberger, Wolfgang, 2004. "How much do electricity tariff increases in Ukraine hurt the poor?," Energy Policy, Elsevier, vol. 32(7), pages 855-863, May.
    3. Fankhauser, Samuel & Tepic, Sladjana, 2007. "Can poor consumers pay for energy and water? An affordability analysis for transition countries," Energy Policy, Elsevier, vol. 35(2), pages 1038-1049, February.
    4. Julian A. Lampietti & Anthony A. Kolb & Sumila Gulyani & Vahram Avenesyan, 2001. "Utility Pricing and the Poor : Lessons from Armenia," World Bank Publications - Books, The World Bank Group, number 13913, December.
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    3. Martins, Rita & Quintal, Carlota & Cruz, Luís & Barata, Eduardo, 2016. "Water affordability issues in developed countries – The relevance of micro approaches," Utilities Policy, Elsevier, vol. 43(PA), pages 117-123.
    4. Teotónio, C. & Martins, R. & Antunes, M. & Quintal, C., 2023. "Unveiling underconsumption of water and electricity services at the bottom of the income distribution," Utilities Policy, Elsevier, vol. 82(C).
    5. Raslavicius, Laurencas & Grzybek, Anna & Dubrovin, Valeriy, 2011. "Bioenergy in Ukraine--Possibilities of rural development and opportunities for local communities," Energy Policy, Elsevier, vol. 39(6), pages 3370-3379, June.
    6. Iuliia Ogarenko & Klaus Hubacek, 2013. "Eliminating Indirect Energy Subsidies in Ukraine: Estimation of Environmental and Socioeconomic Effects Using Input–Output Modeling," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 2(1), pages 1-27, December.
    7. International Monetary Fund, 2010. "Islamic Republic of Iran: Selected Issues Paper," IMF Staff Country Reports 2010/076, International Monetary Fund.

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