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As summer temperatures soar and winter approaches, addressing energy poverty becomes an urgent priority.
July 2023 was the hottest month ever recorded. With summer temperatures continuing to soar across Europe and winter cold spells on the horizon, energy poverty needs to be addressed – and fast. In fact, data reveals that 1 in 5 Europeans cannot adequately cool their homes in the summer. Meanwhile, 1 in 10 are unable to heat their homes properly in the winter. Local governments are racing to find the most effective solutions to tackle energy poverty on the ground, however, they often find themselves side-lined by EU policy solutions.
The EU has recently given the green light to an updated Energy Efficiency Directive as part of its Fit-for-55 Package, consisting of EU proposals to update legislation and ensure policies are in line with climate goals. It defines “energy poverty,” urges countries to set more ambitious energy efficiency goals and aligns with the Social Climate Fund (SCF) to support vulnerable households amid carbon pricing changes under the Emission Trading Scheme.
While these are steps in the right direction, local governments need to be included more directly in the spending and allocation of funds under the Social Climate Fund as they act as first responders to energy poverty on the ground.
"Local governments need to be included more directly in the spending and allocation of funds under the Social Climate Fund as they act as first responders to energy poverty on the ground."
Why are local governments crucial for energy poverty alleviation efforts?
For citizens, municipalities are the closest form of government. They are best placed to reach out to those struggling to pay their energy bills. Especially given recent extreme price increases, it comes as no surprise that local governments are determined to identify, and understand, the many complex reasons why households experience periods of energy poverty.
Many examples of direct support offered at the municipal level to energy poor households can be observed throughout Europe.
The Municipality of Sofia (Bulgaria), for example, has collaborated with the POWERPOOR project to reach out to households to replace old solid fuel heating. These households have been visited by certified “Energy Supporters and Mentors” who carried out simple energy audits of the homes and suggested straightforward behavior changes as well as small-scale measures to increase energy efficiency and savings. In Greece, several municipalities are connecting their efforts to existing programs, such as elderly care, in order to identify and visit households that grapple with paying their energy bills.
Across Europe, many so-called “energy poverty alleviation offices” (EPAO) have materialized as one-stop-shops within municipalities where they provide information about the benefits and support schemes for implementing building renovations, and most people require more immediate advice on how they can reduce their energy bills in the short-term.
The Municipality of Terézváros (Hungary) opened an EPAO in a strategic spot in the inner city, drawing significant local attention. There, the municipality’s sustainability officer can give energy-saving advice to interested citizens, many of whom were elderly residents living alone in large flats with high ceilings, old windows, old convector heating, or gas heating in a tiled stove. Advice included explaining how to read energy bills; how to save on electricity; and how to quickly reduce thermal losses, but also more extensive recommendations on what kind of appliances to use and what kind of financial support is available.
In addition, municipalities often have a good idea of which citizens should be classified as energy poor. In Vitoria-Gasteiz (Spain), identifying and tackling energy poverty is based on collaboration between the municipality’s Social Policy and Territory and Action for Climate departments, carrying out workshops and meetings where the public can receive information about energy poverty mitigation measures.
"Across Europe, many so-called ‘energy poverty alleviation offices’ (EPAO) have materialized as one-stop-shops within municipalities where they provide information about the benefits and support schemes for implementing building renovations, and most people require more immediate advice on how they can reduce their energy bills in the short-term."
Can energy communities be a solution for mitigating energy poverty?
Municipally driven energy communities present a singular solution to reduce the energy costs of participating households, for example, via self-consumption and energy sharing models. Energy communities offer a unique opportunity as they mostly consist of very motivated volunteers who want to make a difference in their local area.
Beyond the immediate production of electricity, these volunteers can also regularly be seen providing free advice to energy poor households. In the case of the energy communities “Enherkom” and “Berener” they are even involved with the creation and staffing of dedicated EPAOs in the municipalities of Hernani and Bergara (Basque Country). And POWERPOOR has provided these communities with training as well as a toolkit that they use to identify and support energy poor households.
In fact, the project has provided many trainings across eight EU Member States and, for instance, members of the energy community “ChalkiON,” as well as staff from the Greek town of Chalki, have received training resulting in energy poor households becoming members of the local energy community allowing these households to immediately benefit from lower energy prices as a result of the Greek system of virtual net-metering, which enables energy community members to receive rebates on their energy bills.
Energy communities, via different models such as energy sharing, can successfully reduce energy costs for those participating and municipalities are starting to realize the benefits of such schemes. A great example of this collaborative spirit can be observed in the parish of Lumiar (Lisbon, Portugal), where thanks to the local authority’s commitment, and cooperation with a network of community associations “Parceira Local de Telheiras” (Local Partnership of Telheiras), the NOVA University of Lisbon, and a well-known Portuguese energy cooperative “Coopernico,” an energy community is being developed including 16 local families.
"Energy communities, via different models such as energy sharing, can successfully reduce energy costs for those participating and municipalities are starting to realize the benefits of such schemes."
Several of the participating households are known to struggle with paying their energy bills and other recurring expenses. At the center of the energy community lies the building used by the local community associations, where solar panels are going to be installed. All participating households are part of the association and hold equal voting rights.
Of course, energy communities aiming to lower energy costs are only as good as their financial gain for participating households. This process requires effective data management that supports energy communities to improve the evaluation, management, and planning of their production plans such as the management provided by the AI-powered framework MATRYCS (which through data analysis of the energy consumption of buildings can identify cost-optimal set-ups).
Long-term solutions needed to address energy poverty
Energy poverty is a local problem with European, and global, consequences. Next to potential short-term national retail measures, it requires local long-term solutions, and, as an unpredictable winter season quickly approaches, comprehensive municipal action is more needed than ever.
"Energy poverty is a local problem with European, and global, consequences. Next to potential short-term national retail measures, it requires local long-term solutions, and, as an unpredictable winter season quickly approaches, comprehensive municipal action is more needed than ever."
However, almost all municipal actions to mitigate energy poverty have one thing in common: they rely on funding and financing to work. While the operation of an EPAO by volunteer members of energy communities goes a long way, and can increase local trust, more reliable structures need to be in place. This is why it is crucial to set up funding streams that support municipalities in their implementation. Next to the financial support available for building renovations, funding under the Social Climate Fund should be deployed directly for the operation of municipal EPAOs staffed by municipal professionals and should be used to cover vulnerable households’ involvement in energy communities.
Every year, 100,000 European die as a result of a cold home. Before the headlines denouncing damages caused by winter weather appear, it is time to align leading local actions on energy poverty mitigation with the allocation and spending of the EU’s Social Climate Fund.