Romania wants to become a provider of energy security in this region of Europe, but at the same time it is one of the champions of the continent in terms of energy poverty. The worst thing is that we do not have any strategy to fight this phenomenon, there are not even clear statistics. Vulnerable consumers depend on assistance, for which it is increasingly difficult to find money in the state budget. The European Commission provides huge sums, but we cannot access them until the government develops an integrated plan, Anka Sinea, coordinator of the Romanian Energy Poverty Observatory (ORSE), tells HotNews.ro.

Romania is one of the European countries most affected by the phenomenon of energy poverty. ORSE data shows that half of the households in Romania cannot meet their energy needs for heating and lighting according to the relevant standards or suffer from high electricity bills.

Until now, measures to support citizens who have problems meeting their energy needs have not been aimed at solving the causes, but have consisted only of minor financial assistance, and have not been aimed at everyone who would need it. This caused the maintenance and even worsening of the phenomenon of energy poverty in Romania. And people must remain terribly dependent on aid, for which we see that it is increasingly difficult to find money in the public budget, says Anka Sinea, coordinator of ORSE.

Lack of access to energy is a form of extreme poverty, and disadvantaged people need to maintain access to these services. The European Pillar of Social Rights, proclaimed by the European Parliament, the Council and the Commission in 2017, and the UN Sustainable Development Goals adopted in 2015, include energy among the basic services to which everyone has the right to access. Energy is important in our life, for a proper standard of living and our health.

Basically, energy poverty has three main, interrelated root causes: low income, high energy costs, inefficiency of buildings and household appliances. Individual consumer behavior also plays an important role.

Given the complexity of the causes and manifestations of energy poverty, this phenomenon cannot be measured by a single indicator.

When analyzed in terms of not being able to heat the house properly, Romania is one of the most affected European countries, with 15.2% of households in this situation in 2022, an increase compared to the previous year, according to Eurostat. In Bulgaria, this percentage was 22.5%, and in Greece – 18.7%. If we look at Hungary, only 4.7% of households assessed that they could not adequately heat their home, this percentage is almost the same as in Poland (4.9%).

Energy poverty is a phenomenon present throughout Europe, which has been exacerbated by the pandemic and the energy crisis. However, there are differences between the countries of the West and the countries of Central and South-Eastern Europe, which is explained by different degrees of economic development, as well as local characteristics, in particular geographical and historical, as well as access to targeted recovery programs. or energy transition is more inclusive.

If we look at the inability to properly heat the home, in 2022 this percentage was 6.6% of households in Germany, 5.1% in Belgium. In France, 10.9% of households could not afford a comfortable temperature at home in winter. Therefore, the interest rates are lower than in Romania.

Another indicator that measures energy poverty is the share of energy consumption in the daily consumer basket. Data compiled by ORSE based on information published by the National Institute of Statistics shows that for 37.3% of households in Romania, energy has become too expensive, exceeding the 10% threshold.

In addition, two in ten households (19.8%) use energy well below the national average, suggesting that they have drastically reduced their consumption because they cannot afford more. They are in what we call “hidden energy poverty” or extreme. These people are actually forced to live in the cold, fearing bills, with a direct health risk.

We do not know how many houses do not have access to the electricity grid

“Our analysis of income deciles (thresholds) also shows that the level of energy poverty increased last year also among Romanians with medium and high incomes. So, this is a phenomenon that increasingly affects all social strata. One explanation is the high inefficiency of buildings, which leads to high energy consumption to maintain comfort even among the so-called “rich”. We are talking here not only about heating costs, but also about cooling costs and everything that means our energy needs,” says Anka Sinea.

Asked how many unelectrified homes there are in Romania, she said that, unfortunately, there is still no correct official estimate for this, and the numbers vary greatly from source to source.

“There are three categories of houses that do not have electricity. First of all, we are talking about non-electrified houses without access to the power grid. The Government’s resolution approving the “National Electrification Program for 2012-2016 regarding electricity supply to non-electrified settlements and expansion of existing networks” mentions almost 100,000 households in such a situation. More precisely, 97,805 unelectrified households located in 2,284 settlements. Later, in 2018, the Ministry of Energy indicated an inventory of more than 52,000 non-electrified houses,” said the ORSE expert.

If we talk about houses that are not equipped with electricity, the data collected during the 2011 census show that there are 287,434 of them. There are still houses with access to the network and equipped with electrical installations, but not connected due to lack of documents or insufficient income, their number is unknown .

It is also necessary to take into account the category of houses with access to the network and connection by fraudulent means. A CSD study based on Deloitte Romania data for 2017 estimates the number of households with unauthorized access to the network at 422,615, i.e. 5.7% of the total number at the national level. The Bucharest-Ilfov region is a champion in this respect, with around 63,000 illegally connected buildings.

Name the main causes of energy poverty in Romania

To better understand the reasons and the national context, it would be useful to look at the regional picture. There are some characteristic features common to the countries of Central and South-Eastern Europe. First, the average income is low compared to Western countries. In addition, post-communist countries such as Romania and Bulgaria still bear the burden of forced urbanization, where apartment buildings were built quickly and without energy efficiency standards, with high energy consumption.

Suboptimal construction standards from the communist period are also inherited at the level of single-family houses. When energy was subsidized, energy waste didn’t matter, but now it affects bills and living standards.

There is another common aspect that characterizes the countries of the region: a large share of the rural population, which is even more vulnerable to energy poverty than in an urban environment.

In Romania, almost half of the population lives in villages. Most of the houses in these areas are old and inefficient, heating is mainly done with wood, in outdated stoves with very low efficiency.

“Incomes of the population in the village are even lower than in the city, so the majority cannot afford to invest in thermal sanitation of houses. “Unfortunately, half of Romania, the rural part, is in the grip of energy poverty,” says the representative of ORSE.

There is also a problem in small towns. Anka Sinea gave the example of the residents of Turda, a small town near Cluj-Napoca, who live in apartment buildings and heat with wood because they do not have access to the gas network and electricity would be too expensive for their budget.

“It’s an unbelievable situation and I’ve seen people trying to get bags of firewood up to the fourth floor,” she says.

So far, there have been no rural housing reconstruction programs, nor diversification of access to alternative, cleaner energy sources.

Even subsidy programs for the installation of photovoltaic panels do not reach the most vulnerable consumers. According to the project, they cannot be accessed by people with very low incomes and without internet access.

How we can reduce energy poverty

First of all, the authorities must correctly diagnose the phenomenon.

“In terms of interventions, the most effective solution to tackling energy poverty for vulnerable consumers is to improve the insulation of buildings. The priority renovation of buildings with the lowest energy efficiency is a legal requirement that should also be applied in Romania.

It is also necessary to replace individual heating and cooling systems with modern equipment such as heat pumps or renewable energy plants. Other methods are district heating and cooling, and supporting communities that use renewable energy sources,” Sinea added.

According to her, there are many opportunities to finance measures to combat energy poverty, and this is a historic opportunity for Romania to overcome energy poverty.

For example, more than €2 billion has been allocated through the PNRR for energy efficiency measures, including building renovations. Romania is receiving another €1.4 billion through REPowerEU, which has become a chapter in the PNRR, and reducing energy poverty is one of the six goals that reforms and investments are required to contribute to.

The Just Transition Fund is also a very important source of European funding. Romania has an estimated allocation of €1.95 billion, the third largest after Poland and Germany, to which is added national co-financing of €0.29 billion, for a total of approximately €2.24 billion.

“The list is longer, but it is very important to mention the Social Fund for Climate Protection, which will become operational from 2026 in connection with the implementation of ETS2 (taxation of carbon emissions in buildings and road transport). Romania will be one of the biggest beneficiaries of this fund and will receive up to 6 billion euros.

This fund will be created to support vulnerable households in the EU, including those affected by energy poverty, vulnerable micro-enterprises and vulnerable transport users. Thus, investments will be aimed at increasing energy efficiency and access to zero- and low-emission transport,” says the ORSE coordinator.

To access these funds, member states must draw up social climate plans by June 2025. These plans must clearly show how energy poverty and mobility poverty will be reduced as a result of the activities and investments financed under the fund. Therefore, by then, Romania should have a clear picture of energy poverty and targeted support measures.

Moreover, the Energy Law obliges Romania to create an integrated national plan to combat energy poverty over 10 years with targets, measurable indicators and clear deadlines.

Read also: limiting energy prices is not enough: almost half of households in Romania are in a state of energy poverty

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