Energy poverty in the Netherlands: the causes, consequences, and solutions

Energy poverty means that a household spends a larger portion of its income on energy costs than average. In 2024, about 400,000 households were affected by this. Rising energy prices, low incomes, and poorly insulated homes can lead to energy poverty. Energy poverty can be solved with energy-saving measures, financial support from the government, and making homes more sustainable.

Energy poverty in brief

About 5% of Dutch households (PDF) experience energy poverty, according to TNO.
Causes: rising energy prices, poor home insulation, and low incomes.
Consequences: health risks, social isolation, increasing social inequality.
Solutions: energy savings, financial support, making homes more sustainable, information, and guidance.

What is energy poverty?

Energy poverty means that households spend a large part of their income on energy costs. According to TNO, if a household- with an income up to 130% of the social minimum - spends more than 8% of its income on energy, it qualifies as energy poverty. By comparison, the average household spends 5% of its income on energy costs (PDF).

There is also hidden energy poverty. This occurs when a household is forced to use less energy than is necessary for a healthy and comfortable life. For example, in winter the heating may be left off, making the home cold, out of fear for high energy bills.
To determine if there is energy poverty, TNO looks at three factors (PDF):

the amount of energy costs
the energy consumption of the home
the possibility to invest in making the home more sustainable

Scale and impact of energy poverty in the Netherlands

About 5% of Dutch households live in energy poverty, equating to about 400,000 households. This is based on an estimate by TNO for 2024.
The number would likely have been twice as high without government support measures and energy saving actions taken by households themselves. This is also shown by research from TNO and CBS.

Energy poverty increased in 2023, after falling in previous years
The percentage of households with energy poverty dropped between 2019 and 2022, partly due to falling energy prices and fewer poorly insulated homes. After 2022, energy prices rose again, leading to more households experiencing energy poverty. As a result, there were 70,000 more households with energy poverty in 2023 than in 2022, according to TNO.

Hidden energy poverty for 1.4% of households
About 1.4% of all households (about 116,000 households) face “hidden energy poverty.” This is shown by research from CBS for 2022. These households could still pay their energy bills by, for example, turning the heating much lower. This is called “underconsumption” of energy.

More energy poverty in Groningen, Limburg, and larger cities
Especially in areas with low incomes and homes with a low energy label, energy poverty is more common:

Northeast Groningen and South Limburg are most severely affected, with percentages up to 10% of households.
In Rotterdam, The Hague, Arnhem and surroundings, Almelo, and Enschede, energy poverty is more frequent than in other cities.

New measurement method is based on the energy poverty gap
The energy poverty gap is the difference between a household’s actual energy costs and the energy poverty threshold. This threshold is calculated based on income and the home’s energy label. According to TNO and CBS, the energy poverty gap shows the scale of households' financial issues more clearly, giving policymakers a fuller picture.

Causes of energy poverty

There are several causes of energy poverty in the Netherlands:

1. Rising energy prices:

Rising energy prices make it difficult for many households to pay their bills. This happened in 2022, when many households could not afford such an increase.
In 2022, energy prices rose by an average of 114% compared to 2021, due to the war in Ukraine and resulting tensions between Europe and gas supplier Russia. After this peak, energy prices fell again in 2023 and 2024.

2. Low incomes:

Households with low incomes are more vulnerable to energy poverty because energy costs make up a larger share of their budget.

3. Health or old age:

Health conditions, such as rheumatism, can lead to higher energy costs. Older people also tend to set their heating higher. This is shown by research on energy poverty from GGD West-Brabant (PDF).

4. Poorly insulated homes:

About 1.5 million Dutch homes are poorly insulated and have a (provisional) energy label E, F, or G. A home with energy label G uses on average 50% more gas and 15-25% more electricity than a home with label A.

5. Energy transition:

The energy transition is necessary to combat climate change, but making homes sustainable also costs a lot of money. Not everyone can afford such investments. For example, a municipality could require home owners to disconnect from the gas network, but alternatives like heat pumps are expensive.

6. Lack of knowledge:

Not everyone knows that subsidies are available for energy-saving measures, according to research by GGD West-Brabant (PDF).
Sometimes the advice for households is contradictory: housing corporations may recommend opening windows for ventilation and to prevent mold, while health professionals advise keeping windows closed to keep out pollen, and police advise closing windows for security.

Consequences of energy poverty for households and society

Energy poverty has a variety of negative effects for individuals and society as a whole:

Health risks: Poorly heated or ventilated homes can develop mold, which can cause respiratory problems. Cold and damp conditions can worsen some circulatory diseases, as shown by GGD research.

Social isolation: People are less likely to invite others into a cold house. Households struggling to pay the energy bill have a higher risk of social isolation and loneliness, as shown in several studies referenced in the GGD research.

Increasing social division: The energy transition can widen the gap between groups in society. Households with more financial means can more easily invest in energy-saving measures. People with lower incomes do not and remain with relatively high energy costs—especially problematic when energy prices rise.

Hindering the energy transition: If you have to spend extra money on energy, there is less left to spend on energy-saving measures, even if these would lower energy costs in the long run. This can delay or hinder the energy transition. The government could financially support households experiencing energy poverty. Research and consultancy bureau Ecorys has calculated that making 1.1 million homes gas-free would cost about €11 billion, but would reduce the average household’s energy bill by €1,100 per month. According to CE Delft, subsidizing sustainability is insufficient for some households and direct financial support is needed to pay energy bills.

Solutions for energy poverty

To tackle energy poverty effectively, a combination of short- and long-term solutions is needed:

Short-term solutions

1. Energy savings:

Promote energy-saving measures such as better insulation and energy efficient appliances, for example by offering discounts on materials or appliances.
Municipal energy coaches can offer free advice to households.

2. Targeted financial support:

Government measures such as the energy supplement and the Temporary Emergency Energy Fund. In 2022, these measures prevented an estimated 400,000 extra households from falling into energy poverty, according to CBS and TNO.
Flexible payment arrangements by energy companies for customers in financial difficulties. For example, Eneco and other organizations set up the EnergyRegelaar service, which gives administrators rapid insight into their clients’ situations.
Eneco also operates a social debt collection policy: payment arrangements, fewer disconnections, and personal contact to discuss customers’ situations. Via Geldfit.nl, Eneco shares energy saving tips. Organizations helping employees or customers reduce debts receive the Warm Incasseren seal of approval, which Eneco has earned as well.

These measures address part of the problem, but are not a lasting solution. For that, long-term solutions are needed.

Long-term solutions

1. Making homes more sustainable:

Large-scale renovation and insulation of homes, especially in the social rental sector. Eneco has advocated a national five-year transition program until at least 2030 as a structural solution for energy poverty in the Netherlands. This program would give targeted income support to 600,000 households with the goal of making homes at least energy label B. So far, the government has not adopted Eneco’s plans.

2. Information and guidance:

Collaboration between municipalities, energy companies, and energy desks to inform and guide people. An energy company can inform customers about available municipal subsidies or connect them to an energy desk for simple energy-saving measure

Previous financial measures to combat energy poverty
The government has previously introduced temporary measures to combat energy poverty.

Energy supplement to reduce energy poverty

To help low-income households pay their energy bills, they were entitled to an energy supplement in 2022 and 2023. This measure was not extended after 2023. The supplement was a one-time payment distributed by municipalities, generally around €800. To qualify, the household income needed to be at or just above the social minimum.

Households that received the supplement in 2022 and had a low income in 2023 also received it automatically in 2023.
This also applied to those on certain social benefits or the supplementary old age benefit (AIO).
The supplement was not counted as income and usually did not affect other benefits.

Temporary Emergency Energy Fund

The Temporary Emergency Energy Fund was an initiative by the national government and nine energy suppliers, including Eneco. The fund was intended to help low-income households pay their energy bills, and it operated from January 22 to March 20, 2024. The total fund was €84 million; households received an average of €588.

Eneco takes its social responsibility
Eneco, the energy supplier, has long been active in Rotterdam and The Hague—cities where many households struggle to make ends meet and where energy poverty is common. Eneco believes it has a social responsibility to support these households. Eneco also aims to be climate neutral by 2035, which requires everyone to be able to participate in the energy transition, including low-income households.