In the European Union, the problem of energy or fuel poverty is not limited to colder climates or particularly poor Member states as one might expect. It exists also in the south of the EU like in Spain, Portugal, Italy, Greece and Cyprus, as well as in relatively well-situated Member states like the UK and Ireland. The BPIE estimates that between 50 and 125 million people in the EU are currently unable to afford proper indoor thermal comfort. At the same time energy efficient renovation of buildings in the EU holds a large potential for energy savings of about 16 Mtoe to 45 Mtoe for residential heating In order to achieve its targets, these potentials are essential for the EU. To unlock these potentials, it is necessary to address all types of households in the residential sector.
This emphasizes the importance of targeting low-income and energy poor households in energy efficiency policy.
Also, the disposable income of a household is impacted directly only by energy efficiency through reduced energy cost (indirectly also through employment effects and others). Thus, this indicator only considers the impact of energy efficiency on the energy consumption of household (including fuel consumption for heating and electricity consumption) assuming constant prices and household income. We also assume a uniform distribution of energy savings among all groups of income in households.
To show the impact on potentially energy poor households, this indicators gives the change of disposable income for the first quintile of income, thus only considering household groups with the lowest 20% of gross incomes.
However, this approach might lead to an overestimation of the effects of energy efficiency on low income households, which are more prone to energy poverty, as they do not benefit as much from energy efficiency policies as higher income groups.
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