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Study Visit and Expert Meeting: report from the Budapest meeting

Energy prices and energy poverty in Eastern Europe: Realities and Perspectives

Metropolitan Research Institute, Habitat for Humanity Hungary, FEANTSA and Habitat for Humanity International joined powers to organize a study visit and expert meeting in Budapest
to better understand the state of play of the possible adverse effects of energy efficiency measures and the energy poverty problems in Central and Eastern Europe in 2022,
and how likely it is to be impacted by current European legislation plans and energy prices increase.

 

Study Visit

The event started on July 6 with an extensive study visit mostly in the 8th district of Budapest city. The group first visited an EU-funded (Horizon 2020) RenoPont, a one-stop-shop service for residents planning energy renovation, further continued with a tour of a social housing building renovated by the 8th district of Budapest, and with a presentation and discussion at the Family and Child Welfare Service Debt Management and Housing Group of the 8th district of Budapest followed by the meeting with the housing manager from the 8th district. The program ended with another presentation and discussion led by Fanni Tóth and Gergely Schum on social housing and energy projects at the district level.

 

Expert meeting: Exchange of views on energy prices & energy poverty in Eastern Europe

On July 7, the program continued in the format of an expert meeting consisting of two presentation sessions and one panel discussion:

Session 1: European perspectives

In session 1, Ludmila Perunska and Veronika Kiss presented the context of the residential building stock in Central and Eastern Europe and presented the two project, implemented by Habitat for Humanity International - Europe and the Middle East, tackling energy poverty in this region - REELIH and ComAct.

Session 2: The social impact of energy prices increases

Panel discussion: What policies to mitigate the social impact?

The event was concluded by a closing session on key takeaways, with a promising message that

“Through establishing combination of building regulations and pricing mechanisms, and through providing the right type and scale of support, the EU can include low-income households in the energy transition, empowering them to deploy effective and structural solutions that will improve their quality of life and help them move away from dependence on imported fossil fuels while contributing to reducing GHG emissions from their homes”

 

Check out the full report with discussion summaries and event outcomes here.

The Right to Energy Coalition unites a network of various groups such as anti-poverty groups, social housing providers, NGOs, environmental campaigners and more, in order to find an adequate solution to energy poverty, as nearly 50 million individuals in Europe suffer from it. It is necessary to highlight the issues of energy poverty and the multi-sectoral impact it has on people, especially groups that are already in a vulnerable state, so as to make affordable energy a possibility.

To this end we are happy to announce we have become partners and members of the Coalition, working together to end energy poverty once and for all!

Right to Energy: a short introduction

The Coalition aims for an energy system that puts people and planet before profit. It was formed in 2017 to advocate for energy poverty in the 2030 EU Clean Energy package. Since then, coalition members have successfully campaigned to ban disconnections, implement free of charge renovations for energy poor households and include the energy poor as key players in the EU Green Deal.

Additionally Right to Energy members have provided essential research on Who’s to Pay for a fair transition and how to secure the Right to Energy for all Europeans. Current work includes ongoing input into the EU Green Deal and energy efficiency legislation, advocacy in member states as well as local community campaigns to secure the right to energy for energy poor households during the pandemic.

An affordable vision

Energy poverty lies at the cross-section of different issues, as a world experiencing global warming that puts people and the planet itself at risk, increasing social inequality, and an unjust energy system, make it harder for regular citizens to live happier and healthier lives.

The Right to Energy Coalition's main motto is that access to clean, affordable energy is a human right. No one should have to choose between eating, lighting or warming his or her home.

The aim is to listen and make the voices of Europe's energy poor heard. A fair energy transition for all is just one side of creating a more affordable world.

What we bring to the table

Habitat for Humanity International's vision for affordable housing and elimination of poverty has for many years now included a focus on energy poverty and energy efficiency, especially in central-eastern Europe, where these issues are very prominent and a cause for concern.

Our expertise stemming from years of working on said issue within the region through the REELIH or ComAct projects for example, together with our NOs, of whom Habitat for Humanity Bulgaria is also a partner to the Coalition, means that we firmly believe that we could hep the Right to Energy Coalition achieve its objective, by providing examples of best practice, networking opportunities and most of all, collaboration to make access to affordable energy a human right.

 

FEANTSA-the European Federation of National Organisations Working with the Homeless, in collaboration with Fondation Abbé Pierre, published a wonderful publication called

ENERGY POVERTY: WHAT ARE THE FOUNDATIONS FOR A GREEN AND SOCIAL PACT FOR EUROPE?

The publication is an overview of national tools for combating energy poverty across Europe and an analysis of the EU approach. It elaborates on prioritized "Green Deal" which should support the poorest households and respond to the challenges of energy poverty. The publication emphasizes that one of the basic weaknesses within the European context remains that Europe still lacks a common definition of energy poverty.

The Energy Poverty Observatory, launched by the European Commission, identified main principles to determine energy poverty:

Even though these indicators cover much of the issue, this publication argues that they fail to grasp one of the key factors - that low-income households are disproportionately vulnerable.

Energy poverty severely impacts country's economic and health situation and also its social cohesion. Moreover, there are large contrasts in realities across Europe and Southern and Eastern Member States particularly suffer from issues of energy poverty. For these reasons, the development of policy instruments to fight and eliminate energy poverty has to be done on two levels - national and European.

This report presents the following topics:

The European Framework

The European Union's policy is built on two pillars:

  1. it sets objectives to take vulnerable consumers into account
  2. it reduces the energy consumption

The European Union is working to help Member States with improving the housing situation through different programs. Now, the European Green Deal highlights the need to support the most affected people and regions and provides financial support through Just Transition Fund. With the general goal of cutting greenhouse gas emissions by at least 50% by 2030, this fund will be directed for the regions with the biggest transition challenges in form of investments in renewable energy sources and energy efficiency in the housing sector.

The European Union recognizes the process of reducing energy consumption through increasing the energy efficiency of the housing stock and delivers a number of successful programs to finance the housing renovation, such as JESSICA , Horizon 2020 or LEMON. Moreover, there is a revolving fund which is a lending facility, continually being replenished by projects reimbursing their loans, which enables the fund to lend again to other projects.

National Intervention Mechanisms

To deal with energy poverty issues on national level, national governments provide public funds for energy and encourage different initiatives to involve also the private sector. However, these mechanisms often fail at reaching all energy poor households because of inadequate funding, targeting or lack of accessibility.

Strategies used by national governments:

The non-take-up is one of the most common issues connected to the state financial programs that fight energy poverty. This is generally linked to three obstacles - knowledge about the aid, accessibility of the aid (complexity of application process) and administrative efficiency in granting the aid. As a solution, the state can either be targeting those who are most vulnerable, or to offer the same aid to everyone. The latter, for example, provides a solution to the stigma associated with receiving of financial aid but can be financially unsustainable. To add, for example, automating payments significantly limit the risk of non-take-ups as such. At the same time, it still does not guarantee that all eligible households will benefit from this kind of support.

Energy poverty combated through renovation of existing housing stock 

The existing housing stock regularly does not confine with the most current regulations and standards on energy efficiency of buildings. Therefore, apart from direct financial support for energy bill payments, there is a material need to renovate the existing residential buildings as a means to get long-term benefit in form of increased savings from lowered energy expenses.

Social Housing

Improving energy efficiency in the social housing stock is even more complex process due to the number of actors included in the process. The key role has to be played by social landlords who adopt comprehensive and strategic approaches. The tenants have to become part of the constructive dialogue with their landlords and the motivation of the landlords has to be assured as to move with the process of housing renovations, especially in social housing.

Issues when renovating private co-owned properties

Basic challenge of renovation of co-owned properties is the amount of money required for the investment in connection of a high number of co-owners of the building. There are all legal, human and financial obstacles to renovating these types of buildings.

The multi-apartment buildings, indeed owned by many small-scale owner-occupiers, are often overlooked in the programs aiming at financial help for renovation.

In this regard, this new report by FEANTSA uses, among others, also REELIH project as an example of a project which improves the living conditions of owner occupiers of exactly these kinds of buildings.

Proposed Recommendations

You can find the whole publication here.

 

On November 25th and 26th, 2019 Centre for Social Sciences Institute of Sociology (TKSZI) in Budapest, Hungary hosted a two day International Conference and Workshop on energy poverty under title ENERGY POVERTY: From Household Problems to Climate Crisis. This event was co-organized by Habitat for Humanity Hungary together with Elosztó and Engager.

From global to local

First day of the conference was dedicated to presentations and discussion on current research, good practices and experiences around defining and measuring energy poverty in Europe with a special focus on Central and Eastern Europe. There were many interesting presentations starting from a high level overview by Diana Ürge-Vorsatz, a Climate researcher from CEU and a member of the UN International Panel on Climate Change, stressing that climate change amplifies inequalities as the severe weather changes affect and will affect the most the poorest ones. Therefore climate change mitigation needs to be interconnected with international development.

 

Following up on this, the focus shifted to national level, taking examples on energy poverty mitigation from other countries such as Spain. Spain has gone through a long path of defining energy poverty and the indicators needed to measure it from 2009, to having a full new National Energy Poverty Strategy in 2019, being in effect until 2024. This was presented by Sergio Tirado Herrero, a  Marie Curie Research Fellow from Autonomous University of Barcelona. Sergio showed by his presentation that it takes time and a lot of effort and political will to design functioning policies targeting energy poor. Similar approach was presented later by Jakub Sokołowski from Institute for Structural Research University of Warsaw, where Poland also defined energy poverty and picked other similar indicators to measure it, fitting the context of the country.

Understanding energy poverty

What we could learn for these approaches is that indicators are not meant to design policies per se. They rather serve the important purpose of recognizing the issue of energy poverty and being able to understand the phenomena. They are not meant to exactly define the person who is energy poor, which would be in a big scale very ineffective and costly, they rather serve as the basis to work out the policies from the understanding of the issue.

On this occasion, Habitat for Humanity International presented learnings from REELIH project of HFHI and USAID related to energy poverty. REELIH project was not originally designed to address energy poverty in the region. The main aim was to get the market and system of energy efficiency refurbishments of multi apartment buildings running. Focusing on working with all the stakeholders from the system, starting with the homeowners until the government to set up a working "eco-system" for people to be able to refurbish their buildings and therefore pay and consume less of the energy. However over the course of implementing the project it was inevitable to start thinking about and taking into consideration the issue of energy poverty in the region. We have contracted Metropolitan Research Institute from Budapest together with Buildings Performance Institute Europe from Brussels to conduct a *research on energy poverty in the countries of implementation of REELIH project-North Macedonia, Bosnia and Herzegovina and Armenia.

Energy poverty in Western Balkans and Armenia 

There are several impediments in these countries when trying to define energy poverty. First of all, there is very severe lack of data needed to be able to measure or compare energy poverty in the countries. Many people heat only part of their apartments to be able to pay for their heating, many people use solid fuel to heat which makes it much more difficult to really find the energy poor. Most important of all for our project, the homeowners in the multi apartment buildings create big social mix of low income, middle income even higher income living in one building.

Therefore, what to do with a socially mixed community when talking about defining energy poor. There are several solutions to that offered by MRI and BPIE in their study:

However, in countries like Western Balkans and Armenia where the system of management and maintenance of multi apartment buildings does not function properly, it might be more useful to focus first on establishing one and only then start addressing energy poor. It is essential first to develop a proper and working regulatory framework for homeowners associations so they are able to act, finance and implement renovations. It is essential to develop banks to offer products to the homeowners associations and to develop national or local governments to be able to motivate their citizens to consume less energy by refurbishing their buildings. Only then it might be useful to try to focus on energy poverty when talking about multi apartment buildings. Similar process happened in countries of Central Europe such as Slovakia or Czech Republic, where only now, after refurbishing almost half of their residential building stock, they start talking about the issue of energy poverty and how to respond to it.

Energy poverty definition in Hungary

Building on knowledge gained from the first day, second day of the conference was in a format of interactive workshop serving as an opportunity for all to contribute to a draft definition of energy poverty and set of indicators for energy poverty within the Hungarian context. This was a well facilitated day, working in groups, exchanging knowledge, brainstorming and discussing together among experts to try to define and understand energy poverty issue in Hungary.

You can find out more on the ENGAGER project here.

You can find out more on the Eloszto project here.

You can find out more on Habitat for Humanity Hungary here.

*The research will be available online early next year 2020.

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