Energy Vulnerability and Energy Poverty: Experience and Approaches in the EU

Working Paper 9/2021

The energy transition represents both an opportunity and a challenge for the European Union (EU). Analysis shows that an absolute energy-related household expenses could rise until 2030 after which the share of energy-related expenses as a proportion of income are expected to decrease (EC 2020c). Therefore, it is important that the costs of the energy transition are distributed fairly. High energy prices are most problematic for vulnerable households and the EU must put appropriate structures in place to ensure that the energy transition benefits the whole society.

At the forefront of current EU energy policy lies the European Green Deal introduced in 2019. The Green Deal sets the political aspiration for greenhouse gas emission reductions of 55 % by 2030 compared to 1990 levels and climate neutrality by 2050. These goals were turned into a legally binding obligation by the European Climate Law (EU 2021). The ‘Fit for 55’ package details how the Green Deal is proposed to be delivered in practice (EC 2021a). The main building blocks of the Green Deal include, for example, the supply of clean, affordable, and secure energy as well as the “Leave no one behind” principle supported through the Just Transition Mechanism (Heyen et al. 2021).

This paper considers the strategies adopted by the EU regarding energy poverty and vulnerability. This includes an overview of the state of energy poverty in the Europe, the role that energy efficiency and the building sector play in these debates, and how the EU interacts with Member States (MS) to drive forward a sustainable energy transition. The paper then turns towards several best-practice examples of instruments and measures that have been implemented to ensure that socially vulnerable households are supported, but also empowered to partake in the energy transition.