• The Communist Party of Austria Proposes Basic ­Energy ­Insurance as a Solution
  • Energy Poverty as a New Social Plague

  • By Lutz Holzinger | 16 May 13
  • Power cuts in winter, people falling into debt traps due to additional charges by gas and electricity companies, heating or eating as a crucial choice – the condition of the poor is becoming increasingly more difficult in Western and Central Europe.

    And the number of poor is rising, because the costs for the immediate necessities – in particular, housing and heating – are rising while the wages of low income earners are steadily falling.

    The Catholic Social Academy and the Protestant Academy, both of which have close ties to the charitable organisations of the churches, have recently published a dossier Against the Cold – Energy Poverty in Austria, which addresses a problem that involves ever more people since the numbers of those manifestly poor and those at risk of poverty is continuously growing. That the problem is acute is illustrated by the following data given in the introduction: ‘In Austria about 331,000 people cannot kept their flats adequately warm. This means they feel uncomfortable, they are freezing, they have to fear the impact on their health and they cannot invite anybody to visit them. How many people have to do without light at home and perhaps cannot cook due to electricity cutoffs, statistics do not tell us’. 

    The scholarly study of energy poverty is a relatively new phenomenon. For a collection of material on this issue Thomas Berger has written the article ‘Energy Poverty: Its Emergence and Problems of Definition’. He writes: ‘Due to the establishment of unfavourable structural orientations in the area of housing, the development of energy costs and the modes of payment for consumers, an academic and political debate on energy poverty began in Great Britain by the mid-1970s.’

    What happened? – De-industrialisation, the forcing up of prices and the transition from the coin-operated pre-payment-system to regular gas metres had led in the 1970s to ever more families with precarious incomes not being able to pay their gas and electricity bills. If in the times of the coin-operated system gas supply would simply be cut off if one had no sixpence coins on hand, the customers now accumulated unpayable debts with the energy providers. As this situation developed, academic research became aware of the problem: Attempts were made to define energy poverty according to different criteria, which, of course, did not help those who had fallen into the trap. This is a phenomenon that is consistently relevant to questions of poverty, and still shows the negative dialectic between miserable housing conditions and above-average energy consumption.


    A current problem everywhere

    With precarious living conditions spreading to ever more parts of the EU, the problem became acute in all the countries in which the need for heating is great in winter. Margit Appel, in her introduction to Against the Cold, emphasises that the issue is just beginning to be researched in Austria; she pointed out, however, that energy poverty is not just a temporary deficit but has several facets: ‘There is one kind of poverty in which people cannot afford adequate energy and another kind in which people are cut off from access to information on energy provision and energy policy or are excluded from social processes of innovation regarding energy transformation and climate justice’.

    As chance would have it, while I was working on my first article (for Volksstimme magazine), the gas heater in our flat stopped working. It was an issue for the provider, as was discovered the following Monday. In the meantime, with below-zero outside temperatures, our flat had become quite frosty. I experienced first-hand what it means to be cut off from energy supply. I would not wish on anyone to work at one´s computer with clammy fingers and the cold creeping up one’s thighs. 

    This is what many people experience at home all the time. In the dossier, Margit Appel and Paloma Fernández de la Hoz write, ‘In five of the EU-countries examined, certain common factors have recently been identified as the causes of energy poverty – low income, restricted access to the labour market and substandard housing as well as energy costs. These result in clearly recognisable negative tendencies for those involved and for the public: Energy poverty tends to affect the physical and/or psychological health of those concerned; the condition of their flats deteriorates while debt problems and CO² emissions increase’. 


    Heating or Eating

    Ultimately, many of those affected face the alternative between heating and eating. Incidentally, children make up a disproportionate part of the victims. The increase of energy prices, far above the rate of inflation in most of the EU countries, has particularly drastic effects on low-income earners. In the course of ‘participatory observation’ in social counselling centres for the book Das Gespenst der Armut [The Spectre of Poverty] in 2009, the author of these lines came across many people who had run into financial difficulties due to electricity and gas back payments raining down on them, amounting to several hundred Euros. A social worker told me that most of the poor live in particularly damp and dark flats which eat up particularly great amounts energy.

    Is it a mere coincidence that energy poverty became an issue in Great Britain when coin-operated electricity and gas metres were abolished in the mid-1970s? Until then it was only possible to consume energy if you had the necessary small change. After the introduction of monthly bills or instalment payments, many households soon could no longer afford to pay their electricity fees – and the public became aware of the problem.

    However, it would be wrong to make abusers out of victims of energy poverty. For example, poverty has been spreading in Austria too: If in the 1970s and 1980s the number of welfare recipients was a five-digit figure, in the 1990s it rose to six digits. In terms of the behaviour patterns of those affected, Appel/Fernández de la Hoz write, based on in-depth interviews: ‘Social workers see in their clientele’s personal attitudes and behaviour patterns a rather limited potential for saving energy and energy efficiency regarding heat, hot water, the use of electricity, acquiring household appliances and especially in terms of improving it substandard housing conditions. However, this in no way bespeaks these clients’ lack of interest in  energy saving and energy efficiency. Rather, compensates for the inefficiency dictated to them by their material conditions with a high degree of ‘sufficiency’, i.e., frugality: “I unplug all the appliances that can be unplugged … I unplug the coffee-maker, the stove, actually everything”’. 

    However, the problem cannot be solved merely by counting on the thriftiness of those affected, although a great deal of effort is put into tackling the problem through numerous initiatives providing professional and volunteer advice to those affected – partly supported by energy providers and political forces. However, ‘in Austria [and also in most other EU states – L.H.] there is no coherent programme for dealing with energy poverty, although there is much in motion. This year Upper Austria has adopted an action programme on energy poverty; municipalities and various organisations such as the Chamber of Labour, Caritas, Volkshilfe as well as private initiatives are carrying out projects on energy poverty and for implementing energy ­efficiency.’


    What Can Be Done?

    In one contribution to the dossier the question of what can be done was raised, leading to a ‘list of recommendations’ addressed to politicians and energy providers along with tips regarding the organisation of the counselling service and the funding system. Suggestions range from avoiding disconnections and increased funding of subjects to power limiters and round tables to social fee rates and contact centres in social institutions. At the same time it was pointed out that in Austria on average 7 per cent of all flats are heated with (costly) electricity, while for low-income-earning households this number is 22 per cent. It is highly questionable whether the ­envisioned bundle of measures will permit an efficient way-out of the ­dilemma.

    By contrast, the CPA’s proposal of free basic energy security (‘Energie­grundsicherung’, or EGS) – presented in a dossier by Christiane Maringer – makes sense, because it provides an effective solution to the problem. In an independent study the following concept was developed: ‘All households are allotted a specifically defined quantity of electricity and heating for free. With about 2,700 kilowatt hours of electricity and 800 cubic metres of gas a two person-household in 60 square metres is able to cover the energy consumption necessary for basic housing and living conditions.’ In addition, these figures are to be adapted to each different general condition.

    The ecological approach of EGS consists in the fact that small consumers are no longer burdened by high standing charges and big consumers are no longer rewarded, because the consumption rate is to grow progressively beyond the provided limit. The measure could be financed by profit recovery from the energy providers, progressive rates for large-volume consumers, revenues from heating-oil taxes and the introduction of a value-added tax in the energy sector. 

    The aim of the EGS concept is a concrete top-down redistribution, its invaluable advantage, according to Maringer, being that ‘it triggers a more offensive approach in that it helps regain a bit of security and does not leave us in a position of only defending past achievements. We are convinced that we have to act with more self-confidence, because if we only demand what is absolutely necessary, we will not get even that!’ This initiative, which has drawn attention in other countries, offers useful approaches for  action, as has been shown by Wolf Jurjans, a CPA district councillor in Vienna’s fifth district, who initiated the action ‘Warmth into the dark!’ against power and gas disconnections, which consists of demonstrations in front of the offices of Vienna’s major electricity provider.