IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v14y2020i1p8-d466268.html
   My bibliography  Save this article

Expenditure-Based Indicators of Energy Poverty—An Analysis of Income and Expenditure Elasticities

Author

Listed:
  • Johannes Thema

    (Wuppertal Institut for Climate, Environment and Energy, Doeppersberg 19, 42103 Wuppertal, Germany)

  • Florin Vondung

    (Wuppertal Institut for Climate, Environment and Energy, Doeppersberg 19, 42103 Wuppertal, Germany)

Abstract

Energy poverty is high up on national and European Union policy agendas. A number of possible indicators to measure the issue have been identified in the literature, but comparable data with European coverage is scarce. The EU Commission thus proposes four independent indicators on the “EU Energy Poverty Observatory” based on self-reported items from the pan-European surveys on income and living conditions (SILC) and household budgets (HBS). It is of increasing public interest to analyse social impacts of energy policies, and quantify energy poverty indicators also from modelling. This paper first shortly outlines how the expenditure-based indicators using HBS micro data may be directly linked to existing macroeconomic models through their defining variables (energy expenditure and income). As endogenous modelling based on micro data is difficult, the link may be country-specific elasticities. The main contribution of the paper is a systematic in-depth sensitivity analysis of the two indicators to changes in income and energy expenditure following varying patterns in the underlying distributions of the micro data. The results may be used by future soft links to models. The results display sometimes counterintuitive effects. We find that whether these indicators increase/decrease after a change of income or energy expenditure largely depends on the specific country-wise income and energy expenditure distribution between households on a micro-level. Due to their definition, the examined indicators are especially sensitive, when income changes alter the indicator threshold values, which in these cases are the median values in underlying distributions. We discuss these findings and relate them to several indicator shortcomings and potential remedies through changes in indicator definition.

Suggested Citation

  • Johannes Thema & Florin Vondung, 2020. "Expenditure-Based Indicators of Energy Poverty—An Analysis of Income and Expenditure Elasticities," Energies, MDPI, vol. 14(1), pages 1-18, December.
  • Handle: RePEc:gam:jeners:v:14:y:2020:i:1:p:8-:d:466268
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/14/1/8/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/1996-1073/14/1/8/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. repec:zbw:rwirep:0542 is not listed on IDEAS
    2. Bouzarovski, Stefan & Simcock, Neil, 2017. "Spatializing energy justice," Energy Policy, Elsevier, vol. 107(C), pages 640-648.
    3. Peter Heindl, 2015. "Measuring Fuel Poverty: General Considerations and Application to German Household Data," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 71(2), pages 178-215, June.
    4. Dominic J. Bednar & Tony G. Reames, 2020. "Recognition of and response to energy poverty in the United States," Nature Energy, Nature, vol. 5(6), pages 432-439, June.
    5. Ha-Hyun Jo & Hyung-Woo Lim & Hae-Dong Kim, 2019. "Measuring the energy poverty and the severity in Korea," Working papers 2019rwp-150, Yonsei University, Yonsei Economics Research Institute.
    6. Day, Rosie & Walker, Gordon & Simcock, Neil, 2016. "Conceptualising energy use and energy poverty using a capabilities framework," Energy Policy, Elsevier, vol. 93(C), pages 255-264.
    7. Bing Wang & Hua-Nan Li & Xiao-Chen Yuan & Zhen-Ming Sun, 2017. "Energy Poverty in China: A Dynamic Analysis Based on a Hybrid Panel Data Decision Model," Energies, MDPI, vol. 10(12), pages 1-14, November.
    8. Manuel Frondel & Stephan Sommer & Colin Vance, 2015. "The burden of Germanyùs energy transition: An empirical analysis of distributional effects," Economic Analysis and Policy, Elsevier, vol. 45(c), pages 89-99.
    9. Hills, John, 2011. "Fuel poverty: the problem and its measurement," LSE Research Online Documents on Economics 39270, London School of Economics and Political Science, LSE Library.
    10. Pachauri, Shonali & Spreng, Daniel, 2011. "Measuring and monitoring energy poverty," Energy Policy, Elsevier, vol. 39(12), pages 7497-7504.
    11. Perlaviciute, Goda & Steg, Linda, 2014. "Contextual and psychological factors shaping evaluations and acceptability of energy alternatives: Integrated review and research agenda," Renewable and Sustainable Energy Reviews, Elsevier, vol. 35(C), pages 361-381.
    12. John Hills, 2012. "Final report of the Hills Independent Fuel Poverty Review: Getting the Measure of Fuel Poverty," CASE Reports casereport72, Centre for Analysis of Social Exclusion, LSE.
    13. John Hills, 2011. "Fuel Poverty: The problem and its measurement. Interim Report of the Fuel Poverty Review," CASE Reports casereport69, Centre for Analysis of Social Exclusion, LSE.
    14. Thomson, Harriet & Snell, Carolyn, 2013. "Quantifying the prevalence of fuel poverty across the European Union," Energy Policy, Elsevier, vol. 52(C), pages 563-572.
    15. Moore, Richard, 2012. "Definitions of fuel poverty: Implications for policy," Energy Policy, Elsevier, vol. 49(C), pages 19-26.
    16. Papada, Lefkothea & Kaliampakos, Dimitris, 2018. "A Stochastic Model for energy poverty analysis," Energy Policy, Elsevier, vol. 116(C), pages 153-164.
    17. Schuessler, Rudolf, 2014. "Energy poverty indicators: Conceptual issues. Part I: The ten-percent-rule and double median/mean indicators," ZEW Discussion Papers 14-037, ZEW - Leibniz Centre for European Economic Research.
    18. Markus M. Grabka & Jan Goebel, 2018. "Income Distribution in Germany: Real Income on the Rise since 1991 but More People with Low Incomes," DIW Weekly Report, DIW Berlin, German Institute for Economic Research, vol. 8(21), pages 181-190.
    19. Pachauri, S. & Mueller, A. & Kemmler, A. & Spreng, D., 2004. "On Measuring Energy Poverty in Indian Households," World Development, Elsevier, vol. 32(12), pages 2083-2104, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Teresa Cuerdo-Vilches & Miguel Ángel Navas-Martín & Ignacio Oteiza, 2021. "Behavior Patterns, Energy Consumption and Comfort during COVID-19 Lockdown Related to Home Features, Socioeconomic Factors and Energy Poverty in Madrid," Sustainability, MDPI, vol. 13(11), pages 1-19, May.
    2. Maike Venjakob & Oliver Wagner & Birte Schnurr, 2023. "Can a CO 2 Tax Be Socially Just? Analysis of the Social Distribution Effects of the German CO 2 Taxation," Energies, MDPI, vol. 16(17), pages 1-14, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Recep Ulucak & Ramazan Sari & Seyfettin Erdogan & Rui Alexandre Castanho, 2021. "Bibliometric Literature Analysis of a Multi-Dimensional Sustainable Development Issue: Energy Poverty," Sustainability, MDPI, vol. 13(17), pages 1-21, August.
    2. Aristondo, Oihana & Onaindia, Eneritz, 2018. "Inequality of energy poverty between groups in Spain," Energy, Elsevier, vol. 153(C), pages 431-442.
    3. Igawa, Moegi & Managi, Shunsuke, 2022. "Energy poverty and income inequality: An economic analysis of 37 countries," Applied Energy, Elsevier, vol. 306(PB).
    4. Kahouli, Sondès & Okushima, Shinichiro, 2021. "Regional energy poverty reevaluated: A direct measurement approach applied to France and Japan," Energy Economics, Elsevier, vol. 102(C).
    5. Llorca, Manuel & Rodriguez-Alvarez, Ana & Jamasb, Tooraj, 2020. "Objective vs. subjective fuel poverty and self-assessed health," Energy Economics, Elsevier, vol. 87(C).
    6. Magdalena Cyrek & Piotr Cyrek, 2022. "Rural Specificity as a Factor Influencing Energy Poverty in European Union Countries," Energies, MDPI, vol. 15(15), pages 1-24, July.
    7. Romero, José Carlos & Linares, Pedro & López, Xiral, 2018. "The policy implications of energy poverty indicators," Energy Policy, Elsevier, vol. 115(C), pages 98-108.
    8. Iñigo Antepara & Lefkothea Papada & João Pedro Gouveia & Nikolas Katsoulakos & Dimitris Kaliampakos, 2020. "Improving Energy Poverty Measurement in Southern European Regions through Equivalization of Modeled Energy Costs," Sustainability, MDPI, vol. 12(14), pages 1-21, July.
    9. Ye, Yuxiang & Koch, Steven F., 2021. "Measuring energy poverty in South Africa based on household required energy consumption," Energy Economics, Elsevier, vol. 103(C).
    10. Legendre, Bérangère & Ricci, Olivia, 2015. "Measuring fuel poverty in France: Which households are the most fuel vulnerable?," Energy Economics, Elsevier, vol. 49(C), pages 620-628.
    11. Charlier, Dorothée & Legendre, Bérangère, 2021. "Fuel poverty in industrialized countries: Definition, measures and policy implications a review," Energy, Elsevier, vol. 236(C).
    12. Yiming Xiao & Han Wu & Guohua Wang & Hong Mei, 2021. "Mapping the Worldwide Trends on Energy Poverty Research: A Bibliometric Analysis (1999–2019)," IJERPH, MDPI, vol. 18(4), pages 1-22, February.
    13. Heindl, Peter & Löschel, Andreas, 2015. "Social implications of green growth policies from the perspective of energy sector reform and its impact on households," ZEW Discussion Papers 15-012, ZEW - Leibniz Centre for European Economic Research.
    14. Drescher, Katharina & Janzen, Benedikt, 2021. "Determinants, persistence, and dynamics of energy poverty: An empirical assessment using German household survey data," Energy Economics, Elsevier, vol. 102(C).
    15. Rafal Nagaj & Jaroslaw Korpysa, 2020. "Impact of COVID-19 on the Level of Energy Poverty in Poland," Energies, MDPI, vol. 13(18), pages 1-18, September.
    16. Aristondo, Oihana & Onaindia, Eneritz, 2018. "Counting energy poverty in Spain between 2004 and 2015," Energy Policy, Elsevier, vol. 113(C), pages 420-429.
    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. Okushima, Shinichiro, 2017. "Gauging energy poverty: A multidimensional approach," Energy, Elsevier, vol. 137(C), pages 1159-1166.
    19. Awan, Ashar & Bilgili, Faik & Rahut, Dil Bahadur, 2022. "Energy poverty trends and determinants in Pakistan: Empirical evidence from eight waves of HIES 1998–2019," Renewable and Sustainable Energy Reviews, Elsevier, vol. 158(C).
    20. Heindl, Peter & Schuessler, Rudolf, 2015. "Dynamic properties of energy affordability measures," Energy Policy, Elsevier, vol. 86(C), pages 123-132.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jeners:v:14:y:2020:i:1:p:8-:d:466268. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.