Energy Poverty: Measurement and Governance in Europe and Lessons for Australia

• Published date: 01 December 2022
• Author: Sangeetha Chandrashekeran,Viktoria Noka,Stefan Bouzarovski
• Date: 01 December 2022
• DOI: http://doi.org/10.1111/1467-8462.12491

The Australian Economic Review, vol. 55, no. 4, pp. 491–502 DOI: 10.1111/1467-8462.12491

Energy Poverty: Measurement and Governance in Europe

and Lessons for Australia

Sangeetha Chandrashekeran, Viktoria Noka and Stefan Bouzarovski*

Abstract

In Australia there is limited understanding of

the scale and nature of energy hardship or

poverty. Energy poverty remains a concept

with no clear def‌inition and therefore no clear

objectives, targets, metrics for data collection

nor institutions to monitor and report on.

Europe, in the last decade, has gone from

limited public recognition of, and policy

action on, energy poverty, to now having

sophisticated quantitative measurement and

monitoring tools, and institutional governance

arrangements that promote transparency and

accountability. In this paper, drawing on the

European experience, we focus attention upon

the measures and indicators of energy poverty

and discuss their advantages and disadvan-

tages. We propose institutional options for

understanding and tackling these problems in

the context of Australia's energy transition.

1. Introduction

In Australia electricity prices are on the rise

again, recently eclipsing their previous high in

2018–19 by over 200% (Australian Energy

Market Operator 2022). This is disproportio-

nately experienced by Australia's lowest

income households who spend a much larger

fraction of their income on electricity and gas

despite spending less in absolute terms

(Bryant et al. 2022). This is pushing many

Australians into energy hardship: a state

where a household is unable to meet basic

energy needs. Affected households are unable

to heat, cool and light their homes to a

required level, or run necessary appliances.

This is often referred to as energy poverty.

For some time, energy poverty has been a

central policy issue in Europe where its

alleviation has been identif‌ied as a key pillar

of a just and fair energy transition to renew-

able energy (Heffron and McCauley 2018).

The EU provides Member States with clear

guidance on how to def‌ine, measure and

address energy poverty, although uptake is

uneven across Member States. In this paper

we discuss the evolution of the EU's approach

to energy poverty. This can be contrasted with

the Australian regulatory approach, which has

focused mainly on measuring hardship pro-

gram participation, disconnections and levels

of debt. In Australia, energy poverty or

hardship remain concepts with no clear

def‌inition and therefore no clear objectives,

targets nor metrics for data collection. Energy

hardship infrequently features in public

* Chandrashekeran: University of Melbourne, Parkville,

Victoria, 3010, Australia; Noka: Oeko-Institut, Berlin,

Germany; Bouzarovski: School of Environment,

Education and Development, University of Manchester,

United Kingdom, Manchester, England. Corresponding

author: Chandrashekeran, email <Sangeetha.chandra@

unimelb.edu.au>.

© 2022 The Authors. The Australian Economic Review publishedby John Wiley & Sons Australia, Ltd on behalf of The University of

Melbourne, MelbourneInstitute: Applied Economic & Social Research, Faculty of Businessand Economics.

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