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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. Julian A. Lampietti & Anke S. Meyer, 2002. "Coping with the Cold : Heating Strategies for Eastern Europe and Central Asia's Urban Poor," World Bank Publications - Books, The World Bank Group, number 15174, December.
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    2. International Monetary Fund, 2010. "Islamic Republic of Iran: Selected Issues Paper," IMF Staff Country Reports 2010/076, International Monetary Fund.
    3. Alberini, Anna & Khymych, Olha & Ščasný, Milan, 2020. "Responsiveness to energy price changes when salience is high: Residential natural gas demand in Ukraine," Energy Policy, Elsevier, vol. 144(C).
    4. Martins, Rita & Quintal, Carlota & Antunes, Micaela, 2019. "Making ends meet: Actual versus potential joint affordability of utility services," Utilities Policy, Elsevier, vol. 56(C), pages 120-126.
    5. 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).
    6. 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.
    7. 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.

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    More about this item

    Keywords

    Affordability Energy Ukraine;

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • P2 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies
    • P3 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions
    • P36 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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