Fuel poverty and financial distress

Abstract

Governments and advocacy groups have drawn attention to the precarious position of those members of society who are unable to attain an adequate level of energy services, i.e. the fuel poor. Concerns have also arisen about the ability of fuel poor individuals to adapt to the hardship recently brought about by the COVID-19 pandemic. This paper contributes to the literature by exploring empirically the link between fuel poverty and financial distress prior to and during the first wave the COVID-19 pandemic. The analysis is based on the most recent longitudinal, nationally representative survey of the United Kingdom, Understanding Society (UKHLS, Wave 10, January 2018–February 2020). After correcting for the effects of potential endogeneity in the variables of interest, our results identify a statistically robust relationship between fuel poverty indicators and self-reported measures of current financial distress, with stronger effects for subjective indicators. The fuel poverty indicators however exert only a limited influence on an individual's expectation of their future financial situation. Our analysis of the first wave of the COVID-19 pandemic also confirms that fuel poverty contributed to financial distress. Our main findings are robust to a suite of specification and sensitivity checks. Our results lead to recommend assessing measures which target fuel poverty on the basis of their potential indirect effect on financial distress.

Examining energy poverty in Chinese households: An Engel curve approach

“…These studies avail equivalised incomes and/or expenditures as model variables—explanatory, explained, or both—as well as utilise them to construct measures of energy poverty. Some notable works—that avail the Engel Curve approach to analysing energy poverty—include Hasan and Mozumder (2017), Churchill and Smyth (2020), Churchill and Smyth (2021), Churchill et al (2020), Burlinson, Giulietti, Law, and Liu (2021), Drescher and Janzen (2021), inter alia. The Equation () models the household's energy poverty (or lack thereof) on demographic, socio‐economic (including equivalised income), housing, and locational indicators: Here, energy poverty is measured by four distinct dummy variable proxies: (a) capturing Low Income and High Cost (LIHC) of energy, (b) capturing lack of appliance ownersh...…”

“…These studies avail equivalised incomes and/or expenditures as model variables-explanatory, explained, or both-as well as utilise them to construct measures of energy poverty. Some notable works-that avail the Engel Curve approach to analysing energy poverty-include Hasan and Mozumder (2017), , Churchill and Smyth (2021), , Burlinson, Giulietti, Law, and Liu (2021), Drescher and Janzen (2021), inter alia. The Equation (1) models the household's energy poverty (or lack thereof) on demographic, socioeconomic (including equivalised income), housing, and locational indicators:…”

Mosque Islamic Social Enterprises Activities as an Instrument of Inclusion; Evidence from Indonesia

“…The presence of mosques in carrying out their social capacities can overcome destitution with Sharia disobedient possessed by mosques not say (Mulder et al, 2023) destitution can affect everybody and is continuously a need issue for all nations within the world (Islam & Alam, 2018), (Sylvestre et al, 2018), (Brathwaite, 2021), (Garibay, 2021), and (Burlinson et al, 2021)…”

“…Poverty may be a real and big problem (Sylvestre et al, 2018). It is an important issue that is constantly being examined by scholastics, supervisors, and non-governmental organizations, at different world gatherings (Brathwaite, 2021), (Burlinson et al, 2021), (Islam & Alam, 2018), and (Garibay, 2021).…”

A Review of Literature on Measuring Energy Poverty

“…Different studies have been conducted on energy poverty and its measurement in the UK. Burlinson et al (2021) investigated the relationship between energy poverty and financial distress of households in the UK and found positive results. Marchand et al (2019) examined the relationship between the poverty of households in the UK and the energy poverty problem in their study.…”