- Rising energy prices will affect European regions rather differently. In some regions, it will change the economic structure while in other it will not be so evident. For some regions, it might even benefit from more expensive energy
- Most regions in EU12 will struggle with rising energy prices. Large parts of the European core demonstrate high levels of specialised labour force in manufacturing. This situation is well-off today but may pose some problems in the future
- In general, capital cities have robust economic structures and likely will not be affected with the increase of energy prices due to the presence of many other activities with low energy intensity
Observations for policy
Changing prices will affect European regions rather differently. In some regions, it will challenge the economic structure while others will not be affected and some might even benefit from it. The typology of energy poverty shows that energy policies and the mitigation actions related to increasing energy prices require territorially differentiated approaches.
Energy is a key issue for growth and territorial development in Europe. The question of how the economic development of a region is affected by changing energy prices is increasingly important. This concerns both the question how much energy input is needed to produce one Euro in added-value as well as the potential to produce renewable energy. Consequently the European strategy on ‘Energy 2020′ underlines among others the need for an efficient use of energy as well as affordable energy.
The map presents five types of regions to discuss risk of energy poverty in Europe:
- ‘With problems and potentials’ includes most capital regions such as Paris, Berlin, Rome, Budapest, Amsterdam, Madrid, Stockholm, Bucharest or Athens, representing clear-cut urban centres, as well as a large number of communities with a low population density. The economic structure is likely to be rather robust to increasing energy prices, due to the emphasis on activities with low energy intensity. Another characteristic of the regional production systems is the low level of workers commuting to other regions;
- ‘Well-off with troubles ahead’ comprises regions much more concentrated and located around central Europe. It includes some of the most densely populated regions of Europe, characterised by a high level of industrialisation, and a medium level of employment in industries with high energy purchase. Rather low fuel costs may be a conditioning factor for maintaining the present economic structure in these regions;
- ‘Struggling, but looking for jobs and a brighter future’ comprises large parts of EU12 and the Iberian Peninsula. The regions are characterised by spending an important share of GDP on fuel costs and low levels of commuting to other regions. Due to their dependence on heavy and energy-consuming industries, these regions are becoming increasingly exposed to global challenges;
- ‘Wealthy and commuting’ regions are characterised by very low fuel costs, in combination with smaller area size and shorter distances as well rather dense private and public transport networks, allow for a very high level of workers commuting to other nearby regions
- ‘Cool and windy, but working’ regions are characterised by a rather low population density, marked distances between urban centres, and a very high potential of wind power. This type covers mainly Ireland, Sweden and Finland.
Concepts and methods
Nine indicators were used in this exercise to reflect the different features of energy poverty, including climate conditions, economic structure, transport dependency, social vulnerability, production of wind and solar energy.