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Energy affordability in the EU: The risks of metric driven policies

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Abstract

This paper provides a pan-EU mapping of energy affordability using energy expenditure shares. Large variations in energy expenditure shares are identified, with the shares being significantly higher in New Member States than the EU15. First, these variations indicate that a single expenditure-based pan-EU fuel poverty metric is problematic; there is a trade-off between a metric identifying households in most need within individual Member States and one identifying households in a similar position across Member States. Second, household-level data from the UK, France and the Republic of Ireland are used to simulate the impact of ‘policy interventions’, involving energy expenditure reductions or income increases, on the recorded rate of fuel poverty. These simulations highlight that emphasising high-level fuel poverty metrics may distort policymakers’ choices towards improving the ‘picture’ of fuel poverty rather than maximising welfare improvements. Robust impact assessments identifying the fuel poverty interventions which deliver the greatest welfare increases for a given cost offer a better means of policy evaluation.

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  • Deller, David, 2018. "Energy affordability in the EU: The risks of metric driven policies," Energy Policy, Elsevier, vol. 119(C), pages 168-182.
    • Handle: RePEc:eee:enepol:v:119:y:2018:i:c:p:168-182
    DOI: 10.1016/j.enpol.2018.03.033
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    Cited by:

    1. Harry R Kennard & Gesche M Huebner & David Shipworth & Tadj Oreszczyn, 2020. "The associations between thermal variety and health: Implications for space heating energy use," PLOS ONE, Public Library of Science, vol. 15(7), pages 1-12, July.
    2. Ye, Yuxiang & Koch, Steven F., 2021. "Measuring energy poverty in South Africa based on household required energy consumption," Energy Economics, Elsevier, vol. 103(C).
    3. Shahzad, Umer & Gupta, Mansi & Sharma, Gagan Deep & Rao, Amar & Chopra, Ritika, 2022. "Resolving energy poverty for social change: Research directions and agenda," Technological Forecasting and Social Change, Elsevier, vol. 181(C).
    4. Davillas, Apostolos & Burlinson, Andrew & Liu, Hui-Hsuan, 2022. "Getting warmer: Fuel poverty, objective and subjective health and well-being," Energy Economics, Elsevier, vol. 106(C).
    5. Rodriguez-Alvarez, Ana & Orea, Luis & Jamasb, Tooraj, 2019. "Fuel poverty and Well-Being:A consumer theory and stochastic frontier approach," Energy Policy, Elsevier, vol. 131(C), pages 22-32.
    6. Bagnoli, Lisa & Bertoméu-Sánchez, Salvador, 2022. "How effective has the electricity social rate been in reducing energy poverty in Spain?," Energy Economics, Elsevier, vol. 106(C).
    7. Mircea (Mike) Bostan, 2021. "EU Electricity Policy (Im)balance: A Quantitative Analysis of Policy Priorities Since 1986," International Journal of Energy Economics and Policy, Econjournals, vol. 11(5), pages 298-309.
    8. Villalobos, Carlos & Chávez, Carlos & Uribe, Adolfo, 2021. "Energy poverty measures and the identification of the energy poor: A comparison between the utilitarian and capability-based approaches in Chile," Energy Policy, Elsevier, vol. 152(C).
    9. Cadaval, María & Regueiro-Ferreira, Rosa Ma & Calvo, Santiago, 2022. "The role of the public sector in the mitigation of fuel poverty in Spain (2008–2019): Modeling the contribution of the BonoSocial deElectricidad," Energy, Elsevier, vol. 258(C).
    10. Wagner, Oliver & Wiegand, Julia, 2018. "Prepayment metering: Household experiences in Germany," Renewable and Sustainable Energy Reviews, Elsevier, vol. 98(C), pages 407-414.
    11. Mircea (Mike) Bostan, 2021. "EU Electricity Policymakers (in) Sensitivity to External Factors: A Multi-decade Quantitative Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 11(6), pages 303-314.
    12. Antunes, Micaela & Teotónio, Carla & Quintal, Carlota & Martins, Rita, 2023. "Energy affordability across and within 26 European countries: Insights into the prevalence and depth of problems using microeconomic data," Energy Economics, Elsevier, vol. 127(PA).
    13. Lilia Karpinska & Sławomir Śmiech, 2021. "Escaping Energy Poverty: A Comparative Analysis of 17 European Countries," Energies, MDPI, vol. 14(18), pages 1-16, September.
    14. Llorca, Manuel & Rodriguez-Alvarez, Ana & Jamasb, Tooraj, 2020. "Objective vs. subjective fuel poverty and self-assessed health," Energy Economics, Elsevier, vol. 87(C).
    15. Igawa, Moegi & Managi, Shunsuke, 2022. "Energy poverty and income inequality: An economic analysis of 37 countries," Applied Energy, Elsevier, vol. 306(PB).
    16. Leitão, João & Ferreira, Joaquim & Santibanez-González, Ernesto, 2022. "New insights into decoupling economic growth, technological progress and carbon dioxide emissions: Evidence from 40 countries," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    17. Dalia Streimikiene & Vidas Lekavičius & Tomas Baležentis & Grigorios L. Kyriakopoulos & Josef Abrhám, 2020. "Climate Change Mitigation Policies Targeting Households and Addressing Energy Poverty in European Union," Energies, MDPI, vol. 13(13), pages 1-24, July.
    18. Danila Longo & Giulia Olivieri & Rossella Roversi & Giulia Turci & Beatrice Turillazzi, 2020. "Energy Poverty and Protection of Vulnerable Consumers. Overview of the EU Funding Programs FP7 and H2020 and Future Trends in Horizon Europe," Energies, MDPI, vol. 13(5), pages 1-17, February.
    19. Marchand, Robert & Genovese, Andrea & Koh, S.C. Lenny & Brennan, Alan, 2019. "Examining the relationship between energy poverty and measures of deprivation," Energy Policy, Elsevier, vol. 130(C), pages 206-217.
    20. Wenhao Qi & Changxing Song & Meng Sun & Liguo Wang & Youcheng Han, 2022. "Sustainable Growth Drivers: Unveiling the Role Played by Carbon Productivity," IJERPH, MDPI, vol. 19(3), pages 1-25, January.
    21. Pedro Macedo & Mara Madaleno & Victor Moutinho, 2022. "A New Composite Indicator for Assessing Energy Poverty Using Normalized Entropy," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 163(3), pages 1139-1163, October.
    22. Deller, David & Turner, Glen & Waddams Price, Catherine, 2021. "Energy poverty indicators: Inconsistencies, implications and where next?," Energy Economics, Elsevier, vol. 103(C).

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