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Energy Affordability in the EU: The Risks of Metric Driven Policies

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  • David Deller

    (Centre for Competition Policy, University of East Anglia)

Abstract

This paper provides a pan-EU mapping of energy affordability using energy expenditure shares for the first time. Large variations in energy expenditure shares across the EU are identified, with the shares being significantly higher in New Member States than the EU15. These variations indicate that a pan-EU fuel poverty metric is inappropriate. Secondly, household-level data from the UK, France and the Republic of Ireland are used to simulate the impact of policy interventions on the recorded rate of fuel poverty. These simulations highlight that emphasising high-level fuel poverty metrics may distort policymakers’ decisions towards manipulating the ‘picture’ of fuel poverty rather than maximising welfare improvements; policymakers may assist households lying closest to fuel poverty thresholds rather than those most in need. 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.

Suggested Citation

  • David Deller, 2016. "Energy Affordability in the EU: The Risks of Metric Driven Policies," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2016-09, Centre for Competition Policy, University of East Anglia, Norwich, UK..
  • Handle: RePEc:uea:ueaccp:2016_09
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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. Wagner, Oliver & Wiegand, Julia, 2018. "Prepayment metering: Household experiences in Germany," Renewable and Sustainable Energy Reviews, Elsevier, vol. 98(C), pages 407-414.
    3. Llorca, Manuel & Rodriguez-Alvarez, Ana & Jamasb, Tooraj, 2020. "Objective vs. subjective fuel poverty and self-assessed health," Energy Economics, Elsevier, vol. 87(C).
    4. 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.
    5. 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.
    6. 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, Open Access Journal, vol. 13(5), pages 1-17, February.
    7. Lisa Bagnoli & Salvador Bertomeu, 2021. "How Effective has the Electricity Social Rate been in Reducing Energy Poverty in Spain?," Working Papers ECARES 2021-05, ULB -- Universite Libre de Bruxelles.
    8. 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, Open Access Journal, vol. 13(13), pages 1-24, July.

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