Ending energy poverty lies at the heart of the EU's future resilience: alleviating it now should be a major social policy priority

Drastically improving the energy efficiency of Europe's buildings, increasing the use of renewables and educating consumers on energy savings are among the main prerequisites for reducing the number of energy poor in the EU in the long term.

With the dramatic hike of energy prices, the strongest impact of which is yet to be felt, the EU is racing to reduce its dependence on fossil fuels and switch to cleaner and cheaper energy supplies. This would secure the EU's energy independence and lead to energy security, and at the same time ensure that Europeans won't struggle to pay their energy bills.

The ongoing energy market disruption needs to be urgently addressed at the EU level to support those who are already energy poor and to avoid the risk of wider social unrest. We need to improve the standards of living for the millions of people across the EU who are currently affected by energy poverty, regardless of whether the 2030 targets are achieved or not.

In this regard, the EU has put forward new legislation and a number of policies tackling energy efficiency and security in the long term, such as the Fit for 55 package, the Social Climate Fund and the latest REPowerEU plan. It has also earmarked a substantial amount of funds. However, a successful green transition that leaves nobody behind will require everyone to get involved – consumers, social partners and the authorities at all levels alike, an EESC hearing said.

The hearing, Tackling Energy Poverty and the EU's Resilience: challenges from a social and economic perspective, brought together representatives of European institutions and civil society, who agreed that fighting energy poverty will be a test for the EU's future resilience and should be topping the EU's agenda now and in the near future.

Combating energy poverty must be an absolute priority for the EU and its Member States, said Ioannis Vardakastanis, rapporteur of the EESC opinion on the topic.

Mr Vardakastanis announced that the EESC opinion will call for an ambitious broad coalition aiming to analyse and address energy poverty through a holistic approach involving European and national stakeholders. He added that increasing incentives for consumers to reduce energy consumption and to renovate buildings smartly and sustainably will help eliminate energy poverty in the long term, together with investing in clean energy, supporting all consumers and protecting the most vulnerable.

D should be the minimum energy class for all buildings by 2030

In her keynote speech, Camille Defard, research fellow at the Jacques Delors Institute, stressed the core importance of the deep energy renovation of buildings for reaching the EU's climate goals and lifting people out of energy poverty.

Today, some 75% of households rely on fossil fuels, mostly gas, to heat their homes. Additionally some 90% of the energy used in buildings is wasted, as over half of the building stock is in the lowest energy class: F. Even before the energy crisis, 35 million Europeans could not afford to keep their homes warm in winter, with this number likely to dramatically rise in the coming months.

To achieve climate neutrality, we need to renovate almost all our buildings to reach the best energy standard, the class 'A'. If we phased out our dependency on fossil fuels, millions of households would be lifted out of energy poverty, Ms Defard said, adding that Europe was now paying the price of past inaction. Energy savings equivalent to Russian gas imports could have been made by implementing renovation objectives over the last decades.

In her view, key recommendations for EU action include an ambitious revision of the Energy Performance of Buildings Directive (EPBD), and setting energy class D as the required minimum energy performance standard for all buildings by 2030.

This also requires a high level of subsidies, enabling policies, technical assistance for Member States and local authorities, and reskilling and upskilling programmes for workers in the construction sector, where new quality jobs should be created.

Energy efficiency has become a matter of national security because of the prices and geopolitical situation, but we first must consider the difference in starting positions in Member States and regions, said MEP Tsvetelina Penkova. At the moment, the situation is not very good, as out of all buildings renovated over the course of one year, only 20% have seen their energy efficiency improve.

Andre Viola, European Committee of the Regions' rapporteur on the EPBD, highlighted the need for sound investment in building renovation.

The building sector is the largest user of energy in the EU and one of the main producers of greenhouse emissions, with more than 30% of these gases traceable back to the sector. To stop climate change we first have to stop greenhouse emissions from houses, Mr Viola said. We know what the solutions are – they are costly – and we need political will to put them in place. But we see this as an investment in the future and as reducing our dependency on fossil fuels.

The energy renovation of buildings and the use of renewables can together help people to escape energy poverty by reducing and eliminating their fossil fuel bills, which the Commission has been advocating for years, said Adela Tesarova from the Commission's DG Energy.

The revised Energy Efficiency Directive will contain a definition of energy poverty, which should build a strong framework for legislation in this field. The Directive will also prioritise the implementation of energy savings among the energy poor and vulnerable, who must be included in renewable projects in their communities. To this end, many municipalities are already starting to set up energy communities.

Ms Tesarova stressed the need for the whole of society to work together on fighting energy poverty by implementing different solutions.

Several projects on energy poverty were presented at the hearing. Monika De Volder from the European Consumer Organisation (BEUC) spoke about the EU-funded project STEP (Solutions to Tackle Energy Poverty), run by 11 consumer and research organisations. From 2019 to 2022, STEP advised 16 000 consumers across Europe, trained over 1 000 frontline workers and triggered 38.4GWh of estimated primary energy savings.

Jeppe Mikél Jensen from the Energy Poverty Advisory Hub said his organisation has set up one-stop shops where house owners can get practical information and guidance for implementing energy-efficient measures at individual level. Julien Joubert from Energy Cities gave an example of a project in Rotterdam where a heat transition strategy has been put in place, including practical supports for households.

Due to a very low understanding of energy efficiency among the general public and the local authorities' low level of expertise in this area, the interest for guidance on energy communities and on tackling energy poverty is huge, the speakers said.

Hurdles along the way

However, implementation on the ground is encountering many stumbling blocks, ranging from slow implementation of the already existing legislation in Member States to the acute shortage of skilled workforces in construction industries across the EU.

Tom Deleu, General Secretary at the European Federation of Building and Woodworkers, said that although the building industry welcomed the focus on the renovation of buildings, the workforce was simply not there.

For the green transition to happen, we must attract new workers into the sector and make sure they have a future in the industry, Mr Deleu said, adding that the construction sector was also lagging behind due to low skilled labour, which was hindering innovation. Obstacles to renovation were also posed by the rising prices of building materials and energy, the unavailability of materials and problems with supply chains.

Gerhard Huemer, Director for Economic & Fiscal Policy at SMEunited, warned about the heavy impact of the green transition on the financial situation of both people and companies. For the transition to be successful, the best safeguard is to keep people employed. Public investment will not be enough – the private sector will have to invest too.

Elmar Thyen, Chair of the SGI Europe Energy Task Force, warned of the high risk of social unrest throughout Europe, as was seen with the Yellow Vest movement, should the energy market disruption persevere.

The Commission rightly identified that energy taxation may worsen energy and transport poverty, and we urged it not to push Member States into the risk of having more people in poverty, Mr Thyen said, adding that water and energy companies have to invest in the future, which they will not be able to do if they are overburdened with the fight against energy poverty.

Laura de Bonfilis, Head of Advocacy at the Social Platform, stressed the need to pay special attention to people who are already energy poor. This makes the need to have a common energy poverty definition ever more urgent.

The energy poor should fully profit from the transition without being stuck with fossil fuels. There should be a social impact assessment mechanism to ensure that energy efficiency measures do not worsen the situation for people whose standard of living is impacted by rising energy prices or who are already energy poor, she maintained.

Additionally, participants agreed that consumers should be protected by a ban on energy supply disconnection.

We must never forget that energy poverty is rooted in general poverty. The Commission and Member States must continue to put specific focus on reducing poverty overall, paying attention to the population already facing energy poverty and those at risk of falling into it because of higher energy prices. These prices remind us of the constant necessity to improve access to employment, social inclusion and standards of living, Ms Vardakastanis concluded.