Energy Affordability: Sharing Lessons from the EU and Australia’s Low Carbon Transitions

Energy affordability is a key concern for households in the European Union (EU) and Australia, as the transformation of the electricity sector unfolds. High prices can lead to energy poverty: when a household cannot afford the essential electricity services needed for a decent standard of living, such as heating. This report compares approaches in the EU and Australia. We analyse the cost drivers, regulatory frameworks and interventions to mitigate hardship and address energy poverty.

We find that that under the right regulatory and market settings, electricity prices can be kept in check as the electricity sector decarbonises. We show  that in both Europe and Australia households in lower income groups spend a much larger fraction of their income on electricity and heat but this dispersion is more pronounced in Australia and has increased over the last decade.   

We argue that Australia can learn a lot from the EU about putting policies in place to tackle energy poverty, however, there are no simple cut-and-paste solutions. The report provides best practice examples for addressing energy hardship from Europe, and  lessons that Europe can learn from Australia’s fast roll out of roof-top solar and smart meters, and the consumer protections that are developing alongside this. 

Read our article in the Conversation. 

The official launch of this report took place on Wednesday 23 February 2022. View the recording of the launch here.