Energy poverty means not being able to afford enough energy to keep your home adequately heated, lit and powered. It is the situation where people are forced to choose between heating their home and meeting other basic needs like food, medicine or rent.
The most commonly used definition in Ireland, based on the Boardman model adopted by the ESRI, classifies a household as energy poor if it spends more than 10% of its net income on energy (electricity and heating fuel, excluding motor fuel). Under the EU Energy Efficiency Directive, the definition has been broadened to include a household’s lack of access to essential energy services that provide basic levels of living and health – including heating, hot water, cooling, lighting and energy for appliances – caused by a combination of low income, high energy costs and poor energy efficiency in the home.
Put simply, energy poverty sits at the intersection of three problems: not enough money, too-high energy bills, and a home that leaks heat. Fix any one of those and the situation improves. Fix all three and energy poverty is eliminated for that household.
📊 Energy Poverty in Ireland: The Scale of the Problem
Ireland has a serious energy poverty problem. ESRI research published in 2022 found that the share of households in energy poverty had reached its highest recorded level, surpassing the previous peak of 23% set in 1994/95. The energy price crisis driven by geopolitical events from 2021 onward hit lower-income households hardest, with energy cost increases amounting to 5.9% of after-tax income for the poorest fifth of households compared to 3.1% for the wealthiest fifth.
Several factors make Ireland particularly vulnerable to energy poverty:
- 🌿 Old, poorly insulated housing stock: Many Irish homes were built before modern insulation standards. Almost 39% of households still use oil for central heating and a further 33% use natural gas – both fossil fuels with volatile prices. Homes with low BER ratings (D, E, F or G) need far more energy to heat, pushing costs up for the households least able to afford it.
- 🌿 High energy import dependency: Ireland imported almost 80% of its energy in 2024. This reliance on imported fossil fuels – 100% of oil, 79.5% of gas – means Irish energy prices are directly exposed to global market volatility.
- 🌿 Rural dispersal: Many energy-poor households are in rural areas with older homes, oil-based heating and limited access to the gas grid or public transport alternatives. Census 2022 data showed that over half of households in some western and midlands counties rely on oil for heating.
- 🌿 Rising carbon tax: While the carbon tax is essential for climate targets, it increases the cost of fossil fuels. At €71 per tonne of CO2 for petrol and diesel (rising to €100 by 2030), it adds to bills for households that have not yet been able to switch to cleaner alternatives.
👥 Who Is Most Affected?
Energy poverty does not affect everyone equally. The groups most at risk include:
- 🌿 Older people living alone – the CSO’s SILC 2024 survey found that one in four people (25.9%) in single-adult households aged 65+ were at risk of poverty overall
- 🌿 Single parents with children – at risk of poverty rate of 24.2%
- 🌿 People with disabilities or long-term health conditions – 32.5% at risk of poverty, and often with higher energy needs due to being at home more and requiring medical equipment
- 🌿 Unemployed people – 34.1% at risk of poverty
- 🌿 Households in older, poorly insulated homes – particularly pre-1990 builds in rural areas
Energy poverty is not just a financial problem. It is a health problem. Living in cold, damp homes is linked to respiratory conditions, cardiovascular disease and poor mental health. The government’s Warmth and Wellbeing pilot scheme, which provided free energy upgrades to 1,672 homes in Dublin, confirmed significant improvements in respiratory symptoms, daily functioning and overall wellbeing after retrofitting.
🏠 How Energy Poverty Connects to Climate Action
Energy poverty and climate action are deeply intertwined. The same homes that are most expensive to heat are also the ones producing the most emissions per household. A G-rated home burns through far more oil or gas than a B2-rated home to achieve the same level of comfort, generating more CO2 in the process.
This creates both a challenge and an opportunity. The challenge is that climate policies like carbon tax increases make fossil fuels more expensive, hitting energy-poor households hardest. The opportunity is that retrofitting these homes solves both problems at once – reducing emissions and slashing energy bills permanently.
This is why the government ring-fences carbon tax revenue for programmes that specifically target energy poverty. In 2024, roughly 60% of the total government retrofit budget was spent on fully funded upgrades for low-income and energy-poor households. The concept of a “just transition” – ensuring that the shift to clean energy does not leave vulnerable people behind – is central to Ireland’s Climate Action Plan.
🔧 What Supports Are Available?
🏡 The Warmer Homes Scheme
The Warmer Homes Scheme is the government’s main tool for tackling energy poverty directly. It provides 100% free energy upgrades – including insulation, heating system replacement, windows and ventilation – to homeowners who receive certain social welfare payments and live in homes with a BER of C or lower.
The scheme has become significantly more ambitious in recent years. The average cost per upgrade has risen from around €2,600 in 2015 to nearly €29,000, reflecting a shift from basic attic insulation to full deep retrofits including external insulation, new windows and heat pump installation. Since January 2025, new fossil fuel boilers are no longer covered – only renewable heating systems like heat pumps are funded.
The downside is waiting times. Current average wait from application to completion is 21-22 months. The SEAI completed 7,743 free upgrades in 2024 (a 31% increase on the year before) and is working to reduce the backlog. The scheme’s budget was €90 million for 2025.
💰 Other Supports
- 🌿 Fuel Allowance: A weekly payment of €33 from October to April for qualifying households, plus a €300 lump sum
- 🌿 Household Benefits Package: €35 per month for all people aged over 70
- 🌿 Higher insulation grants: From March 2026, homeowners on qualifying social welfare payments can access higher fixed-amount grants for attic and cavity wall insulation under the Better Energy Homes scheme – even if they do not qualify for the full Warmer Homes Scheme
- 🌿 SEAI individual grants: For those not eligible for the free scheme, grants cover a significant portion of insulation, heat pump, solar panel and window upgrade costs
- 🌿 Home Energy Upgrade Loans: Low-interest loans from €5,000 to €75,000 to cover the remaining cost after grants
- 🌿 Energy supplier hardship funds: Several energy suppliers operate dedicated funds for customers struggling to pay bills
🔗 How Energy Poverty Connects to Other Climate Terms
- 🌿 BER rating – homes with low BER ratings are the most energy-hungry and most likely to be energy poor
- 🌿 Retrofitting – the permanent solution to energy poverty, reducing fuel bills and emissions together
- 🌿 Heat pumps – replacing fossil fuel boilers eliminates exposure to oil and gas price volatility
- 🌿 U-value – improving the U-values of walls, roof and windows is what makes a home cheaper to heat
- 🌿 Carbon footprint – energy-poor households often have high per-household carbon footprints because of inefficient heating
- 🌿 SEAI grants – the funding pathway out of energy poverty for qualifying homeowners
❓ Frequently Asked Questions
How do I know if I am in energy poverty?
The standard benchmark is spending more than 10% of your net household income on energy (electricity and heating, excluding petrol/diesel). If your energy bills are consuming a disproportionate share of your income and you are restricting heating to save money, you are likely experiencing energy poverty. A BER assessment can reveal how much energy your home wastes and what upgrades would make the biggest difference.
Can I get my home retrofitted for free?
If you receive certain social welfare payments (such as Fuel Allowance, Jobseeker’s Allowance for 6+ months, One-Parent Family Payment, Disability Allowance or others) and your home has a BER of C or lower, you may qualify for the Warmer Homes Scheme. This provides a full retrofit at zero cost. Current waiting times are approximately 21-22 months from application to completion.
Does the carbon tax make energy poverty worse?
In the short term, carbon tax increases raise the cost of fossil fuels, which hits energy-poor households hardest. However, the revenue is ring-fenced and largely directed back toward programmes that help these same households – including the Warmer Homes Scheme, increased Fuel Allowance and other social welfare supports. The long-term solution is to move households off fossil fuels entirely through retrofitting and renewable energy, eliminating their exposure to carbon tax and volatile fossil fuel prices.
What is a just transition and how does it relate to energy poverty?
A just transition means ensuring that the shift to a low-carbon economy does not disproportionately harm vulnerable people or communities. In the context of energy poverty, it means that climate policies like carbon taxes are accompanied by targeted supports – free retrofits, fuel allowances, community energy programmes – so that low-income households benefit from the transition rather than being left behind. Ireland’s Climate Action Plan explicitly links carbon tax revenue to just transition measures.