EU-Ukraine cooperation for developing energy poverty monitoring and reporting frameworks in Ukraine’s reformed energy markets

Under the EU-funded project “Better Services for Consumers in the Reformed Energy Markets – Phase II,” EY continues to deliver a range of support activities, including those related to energy poverty. The EY team has led the design and technical development of the Excel-based Energy Poverty Measurement Tool, encompassing dashboard options, parameter switches, functionality for calculating key metrics, the addition of new datasets and inputs, and other features. EY has also developed the Energy Poverty Reporting Template and the related User Manual to support NEURC in preparing energy poverty monitoring reports.

The EU-funded project “Better Services for Consumers in the Reformed Energy Markets – Phase II” supports the National Energy and Utilities Regulatory Commission (NEURC) in advancing energy market reforms that benefit consumers and stakeholders in Ukraine. Building on Phase I, which began shortly before Russia’s invasion of Ukraine, the project strengthens EU–Ukraine cooperation to develop transparent, competitive wholesale and retail energy markets and improve consumer protection and empowerment. Phase II also supports Ukraine’s EU accession path by helping NEURC align energy market regulation with the EU acquis.

A key focus for Phase II of the project is energy poverty.  The project will support NEURC by developing a tool to calculate, monitor, and report energy poverty levels following on the metrics and framework established in Phase I. Effective monitoring and reporting on energy poverty is important for energy consumers as it helps authorities better understand which households are most affected, track how energy affordability evolves over time, and design targeted support measures that protect vulnerable consumers and improve access to affordable energy services.

The tool developed by the project is the Energy Poverty Measurement Tool that measures energy poverty and estimates affected households, tracks trends, and maps support measures to target areas most in need. By updating the data input tables in the tool, users will receive automated calculations of the energy poverty metrics in the country.   There are three types of energy poverty metrics that will be measured.  Expenditure-based metrics using indicators such as energy expenditure and total income by households, housing costs, household age groups, 2M [1]by country and LIHC (Low Income High Costs)/ LILEE (Low Income Low Energy Efficiency).  Consensual-based metrics using indicators such as inability to keep home adequately warm, arrears in paying utility bills and living in dwellings with leakages and other problems.  Supportive metrics such as utility prices, subsidies and availability of heating. The metrics are presented as infographics on the dashboard and benchmarked against previous year, base year and EU metrics.  Detailed instructions for users were also prepared as well as information on the data sources to be used for updating the Energy Poverty Measurement Tool.

The project also created a standard Energy Poverty Reporting Template covering both energy poverty levels and mitigation actions. It is expected that this reporting template will improve public awareness and facilitate coordination with public authorities.  The reporting template consists of five sections which starts with an at-a-glance overview of the energy poverty situation in Ukraine, highlighting key indicators and targets.  The second section provides an overview of the regulatory landscape regarding energy poverty in Ukraine presenting the current regulatory frameworks, recent changes and key regulatory developments.  The third section provides an overview of the indicators measuring the levels of energy poverty as measured by the designated authorities in Ukraine.  The fourth section includes the pool of measures taken by the Government and NEURC to tackle energy poverty which may include policy, regulatory and government programmes.  The reporting template concludes with a mapping of specific actions required to address energy poverty,

The project presented the tool to NEURC representatives in a tailored online training session where participants had the opportunity to discuss and exchange ideas on their implementation.

In addition to the Energy Poverty Measurement Tool, the project prepared proposals for regulatory arrangements – based on European best practices – for measuring and monitoring energy poverty in Ukraine, including institutional roles, data exchange, and processes, in collaboration with NEURC and other authorities.

The development of this measurement and monitoring framework will strengthen both top-down and bottom-up mechanisms for monitoring the energy poverty in Ukraine. The top-down monitoring will be achieved through the evolution of the selected indicators to monitor energy poverty, while the bottom-up monitoring will be based on assessing the performance of each implemented policy and measure separately. The combined application of these two complementary approaches allows for the establishment of a coherent and holistic analytical framework to identify and assess the drivers of energy poverty. Any divergence between these outcomes may indicate the presence of additional structural or contextual factors influencing energy poverty and/or highlight limitations in the effectiveness and targeting of the implemented policy measures.

The proposed measurement and monitoring framework can be implemented either individually – for example, to support the monitoring and reporting of the National Energy and Climate Plan (NECP) with regards to the implementation of policy measures to mitigate energy poverty, or within the context of a dedicated action plan for the alleviation of energy poverty that can be adopted for a more holistic approach to combat the phenomenon of energy poverty.

In this context, the project organised two stakeholder engagement sessions in March 2026 to gather feedback on the proposed measurement and monitoring framework. The stakeholder discussions highlighted broad agreement that Ukraine should adopt a structured but pragmatic approach to address energy poverty, which starts with establishing a clear, transparent and functional measurement framework. Participants highlighted that effective policy must be based on continuous monitoring of the scale and evolution of energy poverty, supported by a limited set of robust indicators and metrics tailored to national data constraints. At the same time, significant challenges were identified, such as the lack of recent and reliable statistical data and the absence of a universally accepted methodology.

Hence, a stepwise approach emerged as the preferred direction from stakeholders, incorporating improvements in the measurement and monitoring framework and the gradual introduction of policy evaluation mechanisms. Discussions also highlighted the need to align ambition with institutional capacity and the current situation in Ukraine. In addition, while energy poverty in Ukraine is widely seen as closely linked to low income, stakeholders stressed the importance of complementing short-term social support with longer-term structural measures, such as improving energy efficiency and housing conditions. The potential role of a dedicated action plan was recognized as beneficial for coordination and implementation, and future policy development is expected to require greater differentiation between energy poverty and broader concepts of vulnerability.

[1] The 2M metric identifies households as energy poor if their equivalized energy expenditure is more than twice the national median in terms of share of income

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