Fit for 55 and energy poverty

MEHI’s latest study aims to explore how the energy in buildings elements of the Fit for 55 package of proposals can impact on energy poverty in Hungary, and what good practice exists abroad to help affected households. The study will touch on the situation of energy poverty in Hungary, current and proposed policy support options and related challenges.

The building energy targets of the Fit for 55 package of proposals are ambitious, and while efforts in this direction have been welcomed by almost all professionals, the concrete means and targets are dividing the industry. One of the main sticking points is the impact of the package on the energy poor – how can households whose members already face serious livelihood problems pay energy taxes, carbon taxes and make energy renovations on time?

Based on the results of research and modelling on the issue, the proposed measures represent a double-edged sword for energy-poor households. If a Social and Climate Fund (SCF) is established in time and with ample funding (preferably with full use of ETS2 revenues), then with the right motivation, a well-organised and well thought-out support system, technical assistance – and a social awareness-raising and communication campaign – energy-poor households could be the explicit beneficiaries of the new measures and even be lifted out of their predicament en masse.

We have gathered a number of good international examples of how to think about and design support schemes and measures that work well for energy-poor households – and some less successful ones to learn from. We have found that schemes that work well are those where a solid policy framework, with a long-term, pre-planned and transparent support system that is predictably available, helps to achieve similarly designed energy efficiency and energy poverty targets. Successful support schemes are multifaceted: from direct financial support, either through the social system or energy service providers, to social energy tariffs, to support for energy renovation and retrofitting, to additional financing options for energy-poor households with different resources and in different situations.

Targeted policies to address energy poverty have not yet emerged in Hungary. The approach to the issue is also very difficult: there is no definition of energy poverty in Hungary and no indicators to identify those affected. Defining these is also a challenge, as the necessary data and databases are not available, which are needed not only to see what we are up against, but also to properly design and monitor policies and support, and measure the impact. Habitat for Humanity Hungary is preparing a study on the concept, indicators and databases in the framework of our project. In the present work, as a first step, we have attempted to first distinguish the levels of energy poverty in Hungary, and to identify the problems and challenges related to the area and possible solutions (e.g. rental housing programme), among which, besides the lack of data, the lack of responsible government, strategy and planning, lack of professionals, serious lack of resources and capacity in the municipal and social sectors, the issue of deep poverty and worst performing buildings are worth highlighting. The problems are pressing, as the energy crisis continues to exacerbate both the range of stakeholders and the situation, while a well thought-out, holistic approach is needed to find solutions that work well in the long term. As a first step in this process, MEHI staff presented the study to the profession, the press and the public on 18 January 2023. The video of the presentation, the presentations and of course the study can be viewed and downloaded below (in Hungarian).

MEHI Fit for 55 és energiaszegénység tanulmány letöltése (MEHI Fit for 55 and energy poverty)

Recording of the study presentation