Fuel poverty in Spain
In the following guest post, Sergio Tirado outlines the current situation regarding fuel poverty in Spain, and the work presently being conducted by the Asociación de Ciencias Ambientales.
The notion of fuel poverty, or pobreza energética, is mostly unknown to the general and specialized publics in Spain. As in many other EU countries, domestic energy affordability concerns are implicit in recurrent public debates like the ones revolving around the increase of energy prices. But there is no official definition or estimates based on households’ needs to spend on energy (like in the UK), and only very recently has the concept started to become somewhat meaningful for the general public. It is thus absent from the policy and academic literature, which means that fuel poverty is to a large extent alien to decision-makers and scholars, and therefore not addressed in its own terms but rather diffusely through social and perhaps energy and climate policies.
There is, however, a noteworthy exception in the recent past: the EU-sponsored EPEE (European fuel Poverty and Energy Efficiency) project of the Intelligent Europe Programme, which in the late 2000s produced the first indicators on the extent and characteristics of fuel poverty in Spain based on the results of the EU Survey on Income and Living Conditions (EU SILC). This project produced several cross-country comparative studies for 5 EU Member States (Belgium, Italy, France, Spain and the UK) and came up with country-specific recommendations, which in the case of Spain ranged from proposing social tariffs and winter fuel payments to putting together an experts’ group on fuel poverty and launching a fuel poverty monitoring center. The Spanish partner of the EPEE project was the Catalonian NGO Ecoserveis.
This general lack of awareness among the various layers of relevant actors –utility companies, public administration and households – makes fuel poverty a hidden issue in spite of the fact that a sizeable share of the Spanish population is struggling to meet its domestic energy needs. Indicators based on the EU survey on income and living conditions (EU SILC) indicate that as of 2010 around 7% of the Spanish population (over 3 million Spaniards) stated an inability to keep their homes adequately warm in the winter and to be in arrears on utility bills. Though these percentages are well below the worst performers of the EU27 (i.e., Bulgaria, Cyprus or Portugal), a clear upwards trend has been recorded for these indicators in the period 2008-2010. This is most likely the consequence of the deterioration of the economic situation since the outset of the global financial and economic crisis in 2008, which in the case of Spain has resulted in the largest unemployment rate in the EU (22.8 % in the last quarter of December 2011, with 1,5 million households with all active members unemployed and prospects of achieving a 25% unemployment rate by 2013). Acknowledging this situation, the Asociación de Ciencias Ambientales (ACA) has recently launched the project REPEX aimed at exploring and raising awareness about the dual relationship between fuel poverty and unemployment (sadly, Spain can be taken as a best-case for such study). This project’s rationale argues, on the one hand, that fuel poverty is partially caused by unemployment, and, on the other hand, that retrofitting residential buildings offers opportunities to re-employ some of those several million workers that lost their jobs because of the crisis. The latter argument is particularly relevant for Spain because many of the job losses recorded in the last years have happened in the construction and related sectors.
Other structural causes are important to explain longer-term fuel poverty trends in Spain. These are of course household incomes, energy prices and the energy efficiency of the residential stock. Though winters in Spain may not be as harsh as in the rest of Europe (though with large differences within its borders, ranging from the mild, subtropical climate of the Canary islands to the longer, colder winters of the Atlantic façade and the highlands of the Spanish central plateau), heating is needed in most regions for a number of weeks and months. In fact, the perception that some parts of the country (e.g., the Mediterranean coast) are blessed with buen tiempo (good weather) throughout the year may be a cause of the poor energy performance of residential buildings in those areas, which sometimes even lack a proper heating system forcing domestic users to rely on expensive electricity. For the same reason, cooling demands could also be an important (though totally unexplored) element of the fuel poverty reality in the warmer parts of the country. Both winter and summer use of electricity relate, from a fuel poverty perspective, with the on-going debate of the déficit tarifario – the deficit resulting from regulated electricity tariffs below electricity generation and distribution costs as reported by utilities. This deficit has been accumulating since the early 2000s, motivating electricity tariff increases above inflation rates since 2007, and may threaten the long-term sustainability of the Spanish power generation system.
Along the lines drawn above, it can be assumed safely that most Spanish politicians are either unaware of the concept or do not consider it as an issue relevant to be singled out from more general concerns on poverty and social welfare. This does not imply, however, that there is not sensitivity to the issue once it is acknowledged on a wider scale. Based on that premise, the Asociación de Ciencias Ambientales (ACA) took advantage of the November 2011 parliamentary elections to ask (prior to the ballot) the main political parties to state their position towards the fuel poverty challenge in the light of EU Directives 2009/72/CE y 2009/73/CE concerning common rules for the internal market in electricity and gas. This was part of a larger survey that invited political parties to elaborate on selected environmental issues in order to make them go beyond the often rather general statements of their electoral programs.
The most relevant responses to the fuel poverty question came from the two biggest political parties with chances to win the elections (Partido Popularand PSOE); though in total, the responses of 7 parties were collected. That way, it is remarkable that in the view of the currently ruling Partido Popularemployment creation is the one and only solution to fuel poverty (as well as to general deprivation issues). This analysis is probably right in pinpointing unemployment as the main driver of fuel poverty in the short term but largely fails to understand the quality of the housing stock as the key structural cause of fuel poverty.
The response given by the present-day main opposition party (PSOE, social-democratic party, in power until November 2011) shows a more elaborated understanding of the fuel poverty issue. They argue that the country should move towards a sustainable housing model based on low energy buildings and advocate for a rather unspecified ‘sustainable lifestyle’ based on a culture of sparing and efficient use of resources. They also propose a deep reform of the Spanish energy market and consider that energy – like water – should be regarded as a right and not treated as a commodity. However, these rather ambitious statements are quite at odds with their role as governing party in the period 2004-2011, during which the only measure of some relevance was the bono social – a social electricity tariff introduced in 2009 to buffer the impact of increasing electricity tariffs on certain household categories (large families, pensioners and households with all its active members unemployed). Besides, it can be argued that their failure to deflate the real estate bubble that Spain underwent since the early 2000s had a negative effect from a fuel poverty perspective as high housing prices reduced the after-housing-costs income of many households.
Other pertinent answers came also from the emergent green party (EQUO) and the left-wing party Izquierda Unida (IU). The former clearly identified energy efficiency retrofits as the key solution to fuel poverty (though disregarding other factors like energy prices) and as a lever for employment creation in the framework of a green economy. The latter provided a rather unfocused answer describing their vision of the country’s energy model based on renewable energy. Finally, three regionalist/nationalist parties – Bloque Nacionalista Galego, Coalición Canaria and Unión del Pueblo Navarro – spoke mostly of energy markets and prices and gave examples from their corresponding regions in their answers.
Fuel poverty as such has been practically absent from the media, which nevertheless have regularly reported on the increasing difficulties of households to make ends meet as a consequence of the crisis. A recent example of that is a newspaper article published in early February 2012 by EL PAIS informing that almost 70% of the Spanish households have changed their energy use habits as a way to reduce their household expenditures. Interestingly, the cold wave that has swept Europe in the first weeks of February 2012 has motivated the first two articles that, as far as we know, make proper reference to fuel poverty in Spain. They have been published by La Vanguardia: one reports on the conditions experienced by fuel poor families during the coldest days of this winter in the surroundings of Barcelona, and on the assistance provided by municipalities and the Catalonian Red Cross; the other looks at fuel poverty as an issue of European relevance and depicts it as a consequence of austerity measures (using Greece as an example) and increasing global energy prices.