High energy costs represent a poverty risk for low-income households in particular – because they have to spend too much of their income on energy or because they can no longer afford to pay these costs at all. To combat energy poverty while not losing sight of the overarching objectives of energy and climate policy, it is necessary to strike the right balance between energy efficiency and social policy measures. A particular challenge is that energy efficiency policy and social policy have different time horizons and ranges: While social policies primarily target alleviation of financial distress in the short term, energy efficiency policies also have positive ecological, economic and social effects in the medium and long term – the so called multiple benefits of energy efficiency. In addition, it is essential that all end-users, low-income households included, achieve adequate levels of energy efficiency if the ambitious energy and climate targets in Europe are to be met.
To specifically address these challenges, the European Parliament commissioned SQ Consult, the Fraunhofer Institute for Systems and Innovation Research and the Universitat Politècnica de Catalunya to examine the relevance of energy efficiency for low-income households and to develop proposals for how to design policies targeting specific groups.