Building synergies between climate change mitigation and energy poverty alleviation

Even though energy poverty alleviation and climate change mitigation are inextricably linked policy goals, they have remained as relatively disconnected fields of research inquiry and policy development. Acknowledging this gap, this paper explores the mainstream academic and policy literatures to provide a taxonomy of interactions and identify synergies and trade-offs between them. The most important trade-off identified is the potential increase in energy poverty levels as a result of strong climate change action if the internalisation of the external costs of carbon emissions is not offset by efficiency gains. The most significant synergy was found in deep energy efficiency in buildings. The paper argues that neither of the two problems - deep reductions in GHG emissions by mid-century, and energy poverty eradication - is likely to be solved fully on their own merit, while joining the two policy goals may provide a very solid case for deep efficiency improvements. Thus, the paper calls for a strong integration of these two policy goals (plus other key related benefits like energy security or employment), in order to provide sufficient policy motivation to mobilise a wide-scale implementation of deep energy efficiency standards. © 2012

Synergies between energy efficiency and energy access policies and strategies

Policies to improve energy access and energy efficiency are often discussed, designed and assessed in isolation from each other. In this paper, we highlight possible synergies in these two domains of policy making by looking specifically at some key household end uses that are the first to be met once improved access has been provided. By building in efficiency considerations at the very inception of activities aimed at improving access, effective energy supply available is potentially increased, the level of energy services that can be provided by the existing capacity and infrastructure or from existing budgets available is also enhanced, and the potential for reducing the cost for those populations for which cost has the highest consideration is also improved. In particular, we recommend two areas where policy maybe leveraged to benefit both access and efficiency objectives, first in the setting of standards, labels and codes and second coupling energy subsidies for access with rebates or grants for more efficient end use devices

Fuel poverty alleviation as a co-benefit of climate investments: Evidence from Hungary

Fuel (or energy) poverty is understood as a situation in which a household is unable to afford an adequate amount of domestic energy services and/or is forced to pay a disproportionate share of its income on domestic energy. Taking Hungary as a representative case study, the paper first presents relevant indicators which indicate that 10 to 30% of the Hungarian population was in fuel poverty as of the late 2000s. The results show that fuel poverty rates in Hungary have increased in parallel to the price of imported natural gas, forcing some households to go back to heating systems based on firewood. Together with households' income and energy prices, the energy performance of residential buildings has been identified as a key contributing factor of this social and environmental challenge, thus expanding the scope of the benefits of domestic energy efficiency investments. Based on this premise, the second part of the paper presents the results of a social cost-benefit analysis according to which market (energy savings) and non-market (avoided fuel poverty-related mortality, improved comfort and avoided emissions of GHG and other harmful pollutants) benefits more than justify retrofitting Hungary's residential stock to near passive house levels. The results also confirm the relevance of co-benefits for the economic assessment of residential energy efficiency scenarios. This multi-dimensional analysis of fuel poverty emphasises the importance of co-benefits as policy drivers for the implementation of advanced residential energy efficiency solutions in countries with moderate levels of commitment to global climate goals and high or increasing fuel poverty rates

Co-benefits quantified: Employment, energy security and fuel poverty implications of the large-scale, deep retrofitting of the Hungarian building stock

This paper presents the key results of a research that has analysed and quantified the co-benefits of a concrete case where co-benefits have a strong chance to drive policy-making: deep energy-efficient retrofits of buildings in Hungary. In this country, buildings are responsible for half of the energy-related CO2 emissions, are one of the least energy-efficient in the EU, and contain the largest potential for cost-effective mitigation among the different end-use sectors. At the same time, Hungary has the second lowest employment rate of the EU and the OECD, is highly dependent on natural gas imports and a substantial part of its population lives in fuel poverty. Deep energy-efficient retrofitting of the building stock offers a (partial) solution to most of these problems. The main focus of the research was on employment benefits, for which a novel combination of Input-Output analysis with detailed bottom-up estimates was applied. Our findings indicate that if Hungary's residential and public buildings are deep-retrofitted, up to 2030: i) 85% of its heating-related energy consumed and CO2 emitted in 2010 will be avoided; ii) up to 59% of the January net gas imports will be avoided; and iii) as much as 180,000 net additional jobs can be created, with this figure getting lower in time and depending on the renovation dynamic. At the same time, if suboptimal retrofits continue to dominate, 45% of the 2010 heating-related CO2 emissions will be locked-in, with also energy security and employment benefits significantly lower than in deep renovation scenarios. The paper also offers a discussion on the qualitative aspects of the forecasted employment effects in the Hungarian labour market, including its geographic and skill level distribution, as well as recommendations stemming from an overall macroeconomic assessment of such a program. A few weeks after the study's release, the Hungarian government announced its commitment to a deep retrofit program of its building stock