What is energy poverty?

Since committing to the United Nations’ 2030 Agenda for Sustainable Development in 2015, Canada has been working towards 17 specific sustainable development goals (SDGs). These goals include “good health and well-being” and ‘affordable and clean energy.” However, before any of these goals can become a reality in Canada, the overarching issue of energy poverty must be addressed. 

In Canada, a household experiences energy poverty if it is unable to or has financial difficulty with procuring enough energy to meet all its energy needs—including protecting health and meeting socially-accepted norms of comfort and livability. When experiencing energy poverty, a household may have issues with heating or cooling, refrigeration, lighting, or meeting hygiene needs. A primary measure of energy poverty is the expenditure-based 2M method, which considers households to be in energy poverty if the amount of their after-tax income spent on energy is double that of the national median. According to the 2M measure, 2016 census data demonstrates that 21% of Canadian households experience energy poverty. The Canadian Urban Sustainability Practitioners Network (CUSP) reports that households spending more than 6% of their after-tax income are considered to be in energy poverty, with disproportionately high energy cost burdens. However, this rate is likely underestimated, as it is based on current household energy expenditures, not actual need. For example, some households may require more heating than they currently use, but avoid turning up the radiator for fear of higher energy bills. 

Health implications of energy poverty 

Sufficient household energy is essential to health and well-being. Food spoilage due to inadequate refrigeration can mean going to sleep hungry, and resorting to candles for lighting might result in house fires. Not being able to keep the house warm can be fatal to babies and older individuals who are more susceptible to cold injuries such as hypothermia, while heatwaves can prove fatal for seniors without sufficient air conditioning. As working and learning from home becomes more common, being unable to charge electronic devices also becomes a barrier to securing education or employment. 

It should be noted that energy poverty isn’t limited to when the lights or water are turned off due to nonpayment. In a 2019 book, Kimberley O’Sullivan of the University of Otago wrote that households experiencing energy poverty may “restrict their use of energy as a form of budgeting”. This can have significant health impacts—when low-income households face energy poverty, they may be forced to compromise by forfeiting medicine or food in favour of paying their energy bills. There are also long-term health implications of energy poverty: continued exposure to cool indoor temperatures and the constant stress of energy budgeting can lead to an increased risk of cardiovascular events. As extreme weather such as heatwaves or cold spells compounds the health effects of energy poverty, it is a problem inextricably linked to climate change. 

Climate change worsens the impacts of energy poverty

Climate change highlights the havoc that energy poverty can wreak on people’s health and financial security. As locales experience more extremely hot or cold days, households need to expend more energy on heating or cooling their homes or face health consequences such as hypothermia or heatstroke. 

Sonal Jessel of Columbia’s School of Public Health wrote that climate change worsens the health outcomes of energy poverty, as those already experiencing it are the least likely to be able to prepare for, respond to, and recover from natural disasters. Moreover, climate change increases the likelihood of these weather-related natural disasters, which compromise health and impact household energy needs.  

The longer, hotter, and more frequent heatwaves in Canada forecasted due to climate change exemplify this reality. Daytime maximum temperatures are expected to hover around 33 degrees Celsius in Montreal by 2051-2080, which has catastrophic health implications. In 2018, over 70 people died in a Quebec heat wave, most were Montrealers without air conditioning, the main household defence against heatwaves.  In Canada, incessant heatwaves caused by climate change will make air conditioning a basic household need. This is not only an additional burden on families already struggling to pay energy bills but may also push more families into energy poverty. The World Economic Forum reported that households spend up to 42% more on electricity when they own air conditioners. Air conditioners exacerbate energy poverty, but Canadians may have no choice but to buy them given climate change’s trajectory. 

The burden of energy poverty on racialized and new-immigrant communities in Canada

Energy poverty doesn’t just affect the lowest-income households; middle-income families may struggle to heat roomy households in the suburbs as well. However, those hardest hit by energy poverty in Canada are racialized, recent immigrant, and Indigenous households. In 2019, CUSP reported that these groups were more likely to suffer from energy poverty than Caucasian, well-established, and non-Indigenous households. 

Lower incomes, poverty, and higher household occupancy all contribute to a household’s risk of energy poverty. In urban areas, CUSP reported that racialized households are more prone to all three of these risk factors than non-racialized households, accounting for their higher rates of energy poverty. A household’s lower income would mean less money to spend on energy bills, and higher occupancy dwellings require more water or air-conditioning, driving up bills when the household may already be struggling financially. This was evident in the greater metropolitan regions of Toronto, Vancouver, and Montreal. For example, as shown in the graph below, in almost every Montreal Census Metropolitan Area community, racialized households experienced higher rates of energy poverty than non-visible minority households.