Energy Poverty in Ireland: ESRI Report Highlights Affordability Challenges

A new report from the Economic and Social Research Institute (ESRI) reveals that a significant portion of Irish households are struggling with energy affordability, with 14% unable to adequately heat their homes or pay their energy bills in full in 2024. The research underscores the need for more targeted support measures, arguing that universal energy credits are a less cost-effective solution than direct assistance to those most in need.

Extent of Energy Poverty in Ireland

The ESRI report indicates that 14% of Irish households experienced energy poverty in 2024, defined as the inability to afford essential energy services like heating, lighting, cooking, and powering appliances. This figure is lower than the 25% recorded during the 2008 financial crisis, but remains a substantial concern. However, when considering multiple factors, over 30% of households face some form of energy affordability challenge. [RTÉ], [Irish Examiner]

Factors Contributing to Energy Poverty

Energy poverty is driven by a combination of low disposable income, high energy costs, and poor-quality housing. It is closely linked to broader socio-economic issues such as income inequality and unemployment. [ESRI] The report emphasizes that accurately identifying households in difficulty is crucial for effective support.

The Cost of Support Measures

The ESRI’s analysis suggests that providing additional income of, on average, €480 per year to households in energy poverty would alleviate the issue. This targeted approach would cost the State approximately €370 million annually. [RTÉ] This is significantly less than the up to €575 million spent on universal electricity credits in 2024. [RTÉ]

Critique of Universal Energy Credits

The ESRI has criticized the use of universal energy credits, arguing that they are a less efficient way to address energy poverty than targeted supports. [The Journal] Targeted interventions can deliver more adequate support to those most in need at a fraction of the cost of universal measures. [Irish Examiner]

Looking Ahead

The ESRI report highlights the importance of a monitoring system that accurately reflects the multiple ways energy poverty can be experienced. As energy price volatility, climate change, and geopolitical uncertainty continue to pose challenges, a nuanced and targeted approach to energy affordability is essential to ensure a just transition and protect vulnerable households. [ESRI]