To help households struggling to pay their energy bills, a group of NGOs has urged the EU to create strategies to combat fuel poverty in its energy legislation by improving efficiency and building social support structures.
The European arm of the International Network for Sustainable Energy (INFORSE-Europe) published a list of recommendations in late December to address fuel poverty, as more and more households struggle to heat their homes during the winter months. Difficulties in affording basic energy services - which arise from poverty and poor housing - are exacerbated by rising energy prices, calling for energy-related solutions, it said.
The NGOs claimed that energy poverty is triggered when a household's energy costs are greater than 10% of its disposable income. This is the definition used in the UK, where fuel poverty is considered to be a significant social issue, but not every European country uses a clear definition.
As the problem is common to many European countries, with the worst symptoms seen in new member states in Central Europe, it should be made an EU priority, the NGOs argued.
Moreover, EU policies to reduce energy poverty are needed to counter price hikes caused by the internal energy market and the bloc's emissions trading scheme (EU ETS), the NGO group said. EU legislation has tended to increase household energy bills by encouraging the privatisation of energy companies and adding a CO2 premium to prices, it explained.
Revised EU directives on electricity and gas markets require member states to clearly define 'vulnerable' customers, possibly by referring to energy poverty and prohibiting their disconnection from the grid.
But INFORSE argues that avoiding disconnection is only a short-term solution and must be accompanied by energy-efficiency programmes and social support.
Vulnerable households should be given financial assistance to make energy-saving improvements, the NGOs said. In addition, they should have access to free advice on reducing energy bills, they added.
Moreover, lower tariffs for basic consumption and limited price increases could provide further solutions, the organisation said.
Suppliers should consider reducing fixed payment elements and payment models where first units of consumption are charged at higher rates, taxing poorer customers with low consumption, it suggested. The EU's Energy Services Directive could be used to require suppliers to support energy-efficiency improvements in vulnerable households, it said.
In order to finance the new priority, the NGOs advocated harnessing money from the EU's structural funds to support energy efficiency in buildings, and switching from gas to biomass supplies or combined heat and power generation.