As heating bills spike, how can Europe protect its poor?

by Sonia Elks | @SoniaElks | Thomson Reuters Foundation
Wednesday, 22 September 2021 14:03 GMT

ARCHIVE PHOTO: A gas cooker is seen in Boroughbridge, northern England in this November 13, 2012 file photograph. REUTERS/Nigel Roddis/Files

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In Europe, the spectre of soaring heating bills this winter has prompted proposals for innovative ways to help citizens heat their homes

Millions of Europeans face fuel poverty this winter as gas prices hit unprecedented highs, forcing governments to offer a raft of reforms, rules and sweeteners to cushion the blow.

The spectre of soaring heating bills - after a pandemic that has already savaged incomes - has led some countries to come up with innovative ways to help tens of millions of poor Europeans heat their homes through winter.

Here are some of the options on the table:

Subsidies and benefits

Several countries plan temporary cash injections for their poorest, be it help paying fuel bills or higher benefits.

Such moves are popular as they use existing systems that target poorer households, said Louise Sunderland at the environmental non-profit Regulatory Assistance Project (RAP).

Greece will offer most citizens a subsidy on monthly bills; France plans a one-time 100-euro ($117) offer to its poorest.

Fuel price caps

Some countries want to limit the price that consumers are charged for energy, or find other ways to reduce the final bill.

Spain has capped gas price increases and is temporarily slashing taxes on electricity under a package of measures it says will hand consumers billions of euros.

Italy plans to dump 'system costs' - mandatory extras on consumer bills that help pay for renewables and nuclear safety. 

Banning disconnections

Countries can also protect consumers who can't pay their bills from being made to endure winter in an ice-cold home.

Spaniards who could not pay their heating bills already had four months to find the money under rules preventing energy firms from disconnecting poor consumers; now Spain has extended that grace period to 10 months in answer to the price hikes.

Seeking supplies

Countries will be on the lookout for any extra gas to ease the shortages that Europe faces in the coming cold months.

Norway has said that it will send more gas to Europe, starting next month.

Russia says a quick start to its new Nord Stream 2 gas pipeline from Russia to Germany could also cut prices.

The pipeline is ready to use but awaits German approval.

That would normally take months, said Mike Fulwood at the Oxford Institute for Energy Studies, but Germany could go for a temporary approval to get gas flowing this winter.

"It may take the edge off the market," he said.

Invest in the future

In the long term, green solutions and more efficient homes will be the key to steady supplies and costs, experts say.

Be it overhauling how we regulate office temperatures or insulating the poorest homes, switching to low-carbon energy or reducing our overall usage - fundamental change is the best long-term tool for price stability, they said. 

"Continuing with subsidies for bills is like filling the bath without the plug in – it is a measure we would theoretically have to repeat every year," said Sunderland at RAP non-profit.

($1 = 0.8530 euros)

 

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