More than two-thirds of households in Romania that fall below the poverty line after paying their energy bills (67.5%) and more than three-quarters of those in extreme forms of energy poverty (76.3%) are in rural areas, according to the Annual Report 2024 published by the Romanian Energy Poverty Observatory (ORSE). The report also reveals major inequalities between urban and rural areas in terms of access to efficient heating technologies. Analysing most indicators, it emerges that rural areas remain the pole of energy poverty in Romania.

The 2024 Annual Report 2024 published by ORSE includes a new national assessment of fuel poverty, based on available data published by the Office for National Statistics from the Household Budget Survey (ABF 2023).

Energy poverty due to overconsumption (indicator 2M), associated with inefficient housing or high expectations of comfort, is roughly comparable in the two environments – rural (50.1%) and urban (49.9%). The only indicator for which the urban environment has a higher level is 10% (households spending more than 10% of their monthly budget on energy).

 

 

Persistent inequalities between towns and villages

According to data analysed in the Annual Report 2024 published by ORSE, 35.6% of households in Romania still use wood-burning stoves, 88% of which are located in rural areas. These are often inefficient systems, which contribute to both energy vulnerability and pollution, as well as affecting users’ health. Around 80% of rural households still heat predominantly with wood and more isolated with gas or pellet-fuelled power stations. Those that use pellet-fuelled power stations are more likely to be wealthy households that can afford the investment costs.

Urban households are predominantly using gas-fuelled plants, due to better access to the grid. Centralised heating systems are mostly available in large cities, and less so in small towns or communes. Electric heating is more common in urban areas, either as an alternative solution in vulnerable households or due to access to renewable sources.

 

 

Disconnections from the energy grid – a phenomenon mainly in urban areas – are mainly caused by households’ inability to pay their bills. However, official data do not fully reflect this phenomenon, which has persisted in Romanian society for over two decades.

Another important aspect to emphasise is that energy poverty in Romania is still mainly associated with household heating needs. Although Law 226/2021 defines energy poverty in a broad sense, the need for cooling in summer in the context of climate change, which is increasingly being felt, is still not taken into account.

 

Energy captivity and lack of choice

The limited access to modern heating technologies emphasises the phenomenon of energy captivity – a situation where households cannot migrate to more efficient and affordable solutions. This lack of alternatives limits the ability of households to meet their basic energy needs at affordable costs.

Beyond limited or non-existent access to natural gas, many rural areas have outdated energy infrastructure or completely lack modern distribution networks, making it difficult to integrate renewable energy sources.

Many rural households also have low incomes, making it difficult to finance the transition to more sustainable energy sources. In many rural areas, the population is largely ageing, which can reduce the community’s capacity to invest and adopt new technologies. Deploying renewable energy technologies such as solar panels requires initial investments that can be prohibitively expensive for low-income households. Also, lack of technical knowledge and skills to install and maintain renewable energy systems can be a significant barrier.

This is compounded by the fact that many rural dwellers are not aware of the benefits and opportunities offered by renewable energy sources and energy efficiency measures.

“This reality underlines the urgent need for dedicated rural policies targeting access to diversified, affordable and clean energy resources, as well as investment in thermal efficiency works. Although evidence shows the persistence of acute manifestations of energy poverty in rural areas, dedicated measures are few and targeting is difficult. In the context of the realisation process of the Social Climate Fund, through which Romania will receive EUR 6 billion to reduce energy and transport poverty, it is imperative to create clear institutional mechanisms that allow targeting rural communities in depth, not only urban ones, and the development of sustainable economic dynamics in rural areas that will allow an increase in the overall quality of life”, said Anca Sinea, co-founder and coordinator of ORSE.

 

The solutions proposed by ORSE aim to:

1. Create financing programs (e.g. low-interest loans) and subsidies for low-income households willing to invest in energy efficiency and renewable energy projects.
2. Strengthen the capacity of local public administrations under the authority of one-stop-shops to identify community needs and produce tailored solutions, i.e. to facilitate households’ access to remedial programs.
3. Information campaigns and training programs to increase awareness of the benefits of using modern technologies and the technical skills of rural residents.
4. Encouraging renewable energy community projects, where several households – or the whole community – can jointly invest in renewable energy solutions.
5. Government investment to extend and modernise electricity distribution networks in rural areas. Promotion and financing of microgrid projects to ensure stable and efficient energy access for remote communities.

By tackling these challenges, Romania can facilitate the energy transition in rural areas, thus contributing to sustainable development and improving the quality of life in these areas.

For more information and recommended solutions, see the 2024 Annual Report of the Romanian Observatory on Energy Poverty, available on www.saracie-energetica.ro, in the Publications section.

 

About the Romanian Observatory on Energy Poverty

The Romanian Observatory on Energy Poverty (ORSE) is a project initiated by the Centre for the Study of Democracy, a think-tank established in 2006 within the Department of Political Science, Faculty of Political, Administrative and Communication Sciences, Babeș-Bolyai University of Cluj, where it operates as an accredited research centre.

The aim of this initiative is to provide a 360-degree perspective on energy poverty at national level, as well as the expertise needed to combat this complex phenomenon, which affects a large part of the population. ORSE brings together leading experts from various fields relevant to the subject of energy poverty in Romania to identify the best solutions. More information about this project, as well as about energy poverty at national level, can be found on the ORSE website: www.saracie-energetica.ro.