4 months Ago
The rise is driven largely by the expiration of government financial support like the energy allowance and the energy price cap, which helped slash energy costs for many households in 2022 and 2023.
Energy-poor households are typically low-income and high-energy cost ones. They are commonly housed in poorly insulated dwellings, and this provides an opportunity for keeping warm in cold weather.
As a consequence, they have to dedicate a great share of their income only to fulfill their energy requirements.
Rising Costs and Falling Support
In 2024, 510,000 homes (6.1 percent of all homes in the country) were classified as energy poor. That is a jump from 331,000 households, or 4%, in 2023. Typically, affected households are single occupant pensioners or social benefit recipients.
Energy-poor households saw energy bills devour almost 12% of their total income last year, a rise of 4.5% from the previous year. By contrast, average energy spending across all households was about 5 percent of income.
This surge in energy costs arrived as incomes were rising less, which made catching up more difficult for low-income households.
A big reason for the sudden increase is the expiration of several crucial supports. Households were receiving an energy benefit of €1,300 a year until 2023. There was also a ceiling on prices for the first 1,200 cubic meters of gas and 2,900 kilowatt-hours of electricity, which lightened the load for many families.
Possible Solutions and Long-Term Changes
This problem could be addressed by making homes more energy efficient, experts say. Upgrading insulation and converting to sustainable energy sources could, over the long run, reduce energy use and costs.
Equally, income policies could support those who, despite energy-saving initiatives, continue to receive bills that are too expensive for them.
Curiously, the number of households living in energy poverty is still lower now than it was in 2019, when 682,000 households were in difficulty, despite the price of energy being cheaper back then.
This is probably because housing quality and energy efficiency have improved, and incomes have increased in recent years.
Energy poverty is a problem that has never been solved, and it is how leaders decide to address this that will ultimately be the key decision going forward.
