Recital 24 of the Directive (EU) 2018/2002 of the European Parliament and of the Council of 11 December 2018 amending Directive 2012/27/EU on energy efficiency mentions around 50 million households in the European Union to be affected by energy poverty.

 

Nevertheless, the straightforward definition of energy poverty does not exist (ACER/CEER Annual Report of 22 October 2018 on the Results of Monitoring the Internal Electricity and Natural Gas Markets in 2017, Consumer Empowerment Volume).

 

The Third Energy Package only alludes to energy poverty, and the Electricity Directive (Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC) and the Gas Directive (Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC) do not define specifc measures to protect vulnerable consumers.

 

It is left to the EU Member States to decide to what extent specific measures are introduced in the energy laws or whether this belongs to the remit of the general social security system.

 

The subsequent Clean Energy Package (Clean Energy for All Europeans or CEP) - contains clear actions to be undertaken and the obligations laid upon the EU Member States to monitor energy poverty as well as to take measures against it.

 
The recast Electricity Directive (Directive (EU) 2019/944 of the European Parliament and of the Council of 5 June 2019 on common rules for the internal market in electricity) specifes that the concept of vulnerable customers may include income levels, the share of energy expenditure in disposable income, the energy efficiency of homes, critical dependence on electrical equipment for health reasons, age or other criteria (Articles 28, 29).

 
The recast Electricity Directive mandates, in recital 58, that ‘Member States should take the necessary measures to protect vulnerable and energy poor customers in the context of the internal market in electricity.’

 

When preparing the national climate and energy plans under Article 3(3)(d) of the Regulation of the European Parliament and of the Council on the Governance of the Energy Union the EU Member States are required to assess the number of households in energy poverty taking into account the necessary domestic energy services needed to guarantee basic standards of living in the relevant national context, existing social policy and other relevant policies, as well as indicative European Commission guidance on relevant indicators for energy poverty.

 

In the event that the EU Member State finds that it has a significant number of households in energy poverty as supported by its assessment based on verifiable data, it must include in its plan a national indicative objective to reduce energy poverty.

 

Where available, those Member States concerned are required to outline in their plans policies and measures addressing energy poverty, including social policy measures and other relevant national programmes.

 

According to the said Regulation on the Governance of the Energy Union, the EU Member States’ reporting on energy poverty included in integrated national energy and climate progress report must cover:

 

- information on progress towards the national indicative objective to reduce the number of households in energy poverty; 


- quantitative information on the number of households in energy poverty, and, where available,


- information on policies and measures addressing energy poverty.

 

The European Commission is required to share the above data with the European Energy Poverty Observatory.

 

The compliance with the above requirements is a precondition for the application by the Member State of public interventions in price-setting for the supply of electricity.

 

In this context it is useful to refer to Article 5(2) of the recast Electricity Directive, which stipulates that ‘Member States shall ensure the protection of energy poor or vulnerable household customers pursuant to Articles 28 and 29 by social policy or by other means than public interventions in the price setting for the supply of electricity.’

 

However, the same Directive establishes in a subsequent Article 5(4) and 5(5) the preconditions for the EU Member States’ derogation that allows to apply public intervention in electricity price to protect energy poor or vulnerable household customers.

 

According to this derogation clause, the EU Member States’ exceptional public interventions in price-setting for the supply of electricity, to protect energy poor or vulnerable household customers must:
- pursue a general economic interest and not go beyond what is necessary to achieve that general economic interest;
- be clearly defined, transparent, non-discriminatory and verifiable;
- guarantee equal access for Union electricity undertakings to customers;
- be limited in time and proportionate as regards their beneficiaries;
- not result in additional costs for market participants in a discriminatory way.

 

The said ACER/CEER Annual Report of 22 October 2018 noted that in 2017 only 5 CEER Members had definitions of energy poverty, i.e. Cyprus, France, Great Britain, Romania and Spain.

 

According to these definitions, the percentages of energy poor people in the above 5 countries were: 4.6% in Cyprus, 8% in Spain, 9.1% (electricity) and 14.2% (gas) in France, 10.3% in Romania and 11.1% in Great Britain.

 

Cyprus and Spain however, only had a definition of energy poverty in electricity and not in gas.

 

When it comes to reasons for energy poverty the three main drivers can be differentiated:


- firstly, the costs of energy are crucial and they are the result of market forces;


- the second important part of the energy bill are network tariffs, which are regulated (approved by national regulatory authorities),


- thirdly, taxes and levies imposed on energy are impacted by political decisions regarding the funding of the energy transition.

 

 

 

Regulation of the European Parliament and of the Council on the Governance of the Energy Union

 

Article 24

 

Integrated Reporting on Energy Poverty

 

Where the second subparagraph of point (d) of Article 3(3) applies, the Member State concerned shall include in its integrated national energy and climate progress report:

(a) information on progress towards the national indicative objective to reduce the number of households in energy poverty; and

(b) quantitative information on the number of households in energy poverty, and, where available, information on policies and measures addressing energy poverty.

The Commission shall share data communicated by Member States pursuant to this Article with the European Energy Poverty Observatory.

 

Article 3(3)(d)

 

With regard to their integrated national energy and climate plans, Member States shall:

...

assess the number of households in energy poverty taking into account the necessary domestic energy services needed to guarantee basic standards of living in the relevant national context, existing social policy and other relevant policies, as well as indicative Commission guidance on relevant indicators for energy poverty.

 

In the event that a Member State finds, pursuant to point (d) of the first subparagraph, that it has a significant number of households in energy poverty, on the basis of its assessment of verifiable data, it shall include in its plan a national indicative objective to reduce energy poverty. The Member States concerned shall outline in their integrated national energy and climate plans, the policies and measures, which address energy poverty, if any, including social policy measures and other relevant national programmes.

 

 

 

 

Directive of European Parliament and of the Council on the promotion of the use of energy from renewable sources (recast), Recital 65

 

Empowering jointly acting renewable self-consumers also provides opportunities for renewable energy communities to advance energy efficiency at household level and help fight energy poverty through reduced consumption and lower supply tariffs. Member States should take appropriate advantage of this opportunity by, inter alia, assessing the possibility to enable participation by households that might otherwise not be able to participate, including vulnerable consumers and tenants.

 

 

 

 

Directive (EU) 2018/2002 of the European Parliament and of the Council of 11 December 2018 amending Directive 2012/27/EU on energy efficiency

 
Recital 24

 

Around 50 million households in the Union are affected by energy poverty. Energy efficiency measures must therefore be central to any cost-effective strategy to address energy poverty and consumer vulnerability and are complementary to social security policies at Member State level. To ensure that energy efficiency measures reduce energy poverty for tenants sustainably, the cost-effectiveness of such measures, as well as their affordability to property owners and tenants, should be taken into account, and adequate financial support for such measures should be guaranteed at Member State level. The Union's building stock needs, in the long term, to be converted to NZEBs in accordance with the objectives of the Paris Agreement. Current building renovation rates are insufficient and buildings occupied by citizens on low incomes who are affected by energy poverty are the hardest to reach. The measures laid down in this Directive with regard to energy savings obligations, energy efficiency obligation schemes and alternative policy measures are therefore of particular importance.

 

Recital 25


Lower consumer spending on energy should be achieved by assisting consumers in reducing their energy use by reducing the energy needs of buildings and improvements in the efficiency of appliances, which should be combined with the availability of low-energy transport modes integrated with public transport and cycling.

 

 

 

 

Directive (EU) 2019/944 of the European Parliament and of the Council of 5 June 2019 on common rules for the internal market in electricity (recast), Recitals 58 - 60, Articles 5(1) - (5), 28, 29

 

Recital 58

 

Member States should take the necessary measures to protect vulnerable and energy poor customers in the context of the internal market for electricity. Such measures may differ according to the particular circumstances in the Member States in question and may include social or energy policy measures relating to the payment of electricity bills, to investment in the energy efficiency of residential buildings, or to consumer protection such as disconnection safeguards. Where universal service is also provided to small enterprises, measures to ensure universal service provision may differ according to whether those measures are aimed at household customers or small enterprises.

 

Recital 59

 

Energy services are fundamental to safeguarding the well-being of the Union citizens. Adequate warmth, cooling and lighting, and energy to power appliances are essential services to guarantee a decent standard of living and citizens' health. Furthermore, access to those energy services enables Union citizens to fulfil their potential and enhances social inclusion. Energy poor households are unable to afford those energy services due to a combination of low income, high expenditure on energy and poor energy efficiency of their homes. Member States should collect the right information to monitor the number of households in energy poverty. Accurate measurement should assist Member States in identifying households that are affected by energy poverty in order to provide targeted support. The Commission should actively support the implementation of the provisions of this Directive on energy poverty by facilitating the sharing of good practices between Member States.

 

Recital 60

Where Member States are affected by energy poverty and have not developed national action plans or other appropriate frameworks to tackle energy poverty, they should do so, with the aim of decreasing the number of energy poor customers. Low income, high expenditure on energy, and poor energy efficiency of homes are relevant factors in establishing criteria for the measurement of energy poverty. In any event, Member States should ensure the necessary supply for vulnerable and energy poor customers. In doing so, an integrated approach, such as in the framework of energy and social policy, could be used and measures could include social policies or energy efficiency improvements for housing. This Directive should enhance national policies in favour of vulnerable and energy poor customers.

 

Article 5(1) - (5)

Market-based supply prices

 

1. Suppliers shall be free to determine the price at which they supply electricity to customers. Member States shall take appropriate actions to ensure effective competition between suppliers.

 

2. Member States shall ensure the protection of energy poor and vulnerable household customers pursuant to Articles 28 and 29 by social policy or by other means than public interventions in the price setting for the supply of electricity.

 

3. By way of derogation from paragraphs 1 and 2, Member States may apply public interventions in the price setting for the supply of electricity to energy poor or vulnerable household customers. Such public interventions shall be subject to the conditions set out in paragraphs 4 and 5.

 

4. Public interventions in the price setting for the supply of electricity shall: (a) pursue a general economic interest and not go beyond what is necessary to achieve that general economic interest;

(b) be clearly defined, transparent, non-discriminatory and verifiable;

(c) guarantee equal access for Union electricity undertakings to customers;

(d) be limited in time and proportionate as regards their beneficiaries;

(e) not result in additional costs for market participants in a discriminatory way.

 

5. Any Member State applying public interventions in the price setting for the supply of electricity in accordance with paragraph 3 of this Article shall also comply with point (d) of Article 3(3) and with Article 24 of Regulation (EU) 2018/1999, regardless of whether the Member State concerned has a significant number of households in energy poverty.


...

 

Article 28

Vulnerable customers

 

1. Member States shall take appropriate measures to protect customers and shall ensure, in particular, that there are adequate safeguards to protect vulnerable customers. In this context, each Member State shall define the concept of vulnerable customers which may refer to energy poverty and, inter alia, to the prohibition of disconnection of electricity to such customers in critical times. The concept of vulnerable customers may include income levels, the share of energy expenditure of disposable income, the energy efficiency of homes, critical dependence on electrical equipment for health reasons, age or other criteria. Member States shall ensure that rights and obligations linked to vulnerable customers are applied. In particular, they shall take measures to protect customers in remote areas. They shall ensure high levels of consumer protection, particularly with respect to transparency regarding contractual terms and conditions, general information and dispute settlement mechanisms.


2. Member States shall take appropriate measures, such as providing benefits by means of their social security systems to ensure the necessary supply to vulnerable customers, or providing for support for energy efficiency improvements, to address energy poverty where identified pursuant to point (d) of Article 3(3) of Regulation (EU) 2018/1999, including in the broader context of poverty. Such measures shall not impede the effective opening of the market set out in Article 4 or market functioning and shall be notified to the Commission, where relevant, in accordance with Article 9(4). Such notifications may also include measures taken within the general social security system.


Article 29

Energy poverty

 

When assessing the number of households in energy poverty pursuant to point (d) of Article 3(3) of Regulation (EU) 2018/1999, Member States shall establish and publish a set of criteria, which may include low income, high expenditure of disposable income on energy and poor energy efficiency.


The Commission shall provide guidance on the definition of ‘significant number of households in energy poverty’ in this context and in the context of Article 5(5), starting from the premise that any proportion of households in energy poverty can be considered to be significant.

 

 

 

 

 

 

IMG 0744

    Documentation    




 

 

Directive (EU) 2019/944 of the European Parliament and of the Council of 5 June 2019 on common rules for the internal market in electricity (recast Electricity Directive), Articles 5(1) - (5), 28, 29, Recitals 58 - 60

 

Regulation of the European Parliament and of the Council on the Governance of the Energy Union, Article 3(3)(d), Article 24

 

Directive (EU) 2018/2002 of the European Parliament and of the Council of 11 December 2018 amending Directive 2012/27/EU on energy efficiency

 

Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC

 

Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC
 

Christoph Strünck, Fighting Energy Poverty in Europe – Responses, Instruments, Successes

 

ACER/CEER Annual Report of 22 October 2018 on the Results of Monitoring the Internal Electricity and Natural Gas Markets in 2017, Consumer Empowerment Volume



 

 

clip2

    Links    

 

 

 

EU Energy Poverty Observatory

 

Universal service

 

https://energypedia.info/wiki/Energy_Poverty