year the European Comission proposed introducing a Climate Social Fund as part
of its “Fit for 55” legislative package. This meant that the EU had declared
war on air and environmental pollution. Businesses regretted this because
greenhouse gas emissions should be reduced by 2030 and even cut by 55 per cent
when compared to 1990.
Energy prices are increasing rapidly
Climate Social Fund is intended to protect mainly low-income households from
the increase in fuel prices. People with low incomes are being especially
challenged as electricity and heating costs are now higher as are their housing
and living costs. People living in rural areas who are dependent on a car due
to poor public transport connections are now burdened with high fuel prices.
Estimate: 31 million people will be affected by energy poverty
rise in energy prices has occurred earlier than expected as a result of the
conflict in Ukraine. This is hitting the EU particularly hard. There are still
only numerical estimates of how many citizens in Europe are being affected by
real energy poverty. Eurostat, the European statistical office, found that in
2021, 31 million people might be living in energy poverty. However, a uniform
European definition of this “energy poverty” term still does not exist.
fact the question as to how energy poverty should be defined remains
unanswered. An attempt at a solution was presented by the two conservative
MEPs, Esther de Lange (EPP/NL) and David Casa (EPP/MLT). As a correspondent they
have to report on the Parliament's position regarding the EU’s Social Climate
proposed that the following passage should be used as a definition in their
draft: "Households in the lowest tenth of the income bracket whose energy
costs exceed twice the median ratio of energy costs to disposable income after
deducting housing costs". Not only are the increasing electricity and gas
costs compared against income, but housing costs are also taken into account.
The financial breakdown is still unclear
transition to climate neutrality is also promoting lasting social change. The European Comission
envisages 50 per cent co-financing together with the member states. However,
the Parliament called for a distinction to be made between EU states with a
strong budget and those with a weak one. The contribution from economically
poorer states should drop to 40 per cent and rise to 60 per cent for
economically stable states.
remains to be seen exactly what the final arrangement and the benefits for
citizens will look like. The final report from the European Parliament is
likely to be finalised in May and it will be sent to the European Parliament's
Employment Committee for voting on.