Fuel poverty in the UK: Is there a difference between rural and urban areas?

Abstract

Fuel poverty is a significant policy issue. An argument often made is that rural households are more likely to be fuel poor due to the nature of rural housing stock and the more limited choice of energy sources in rural areas. This paper uses panel data to compare the level and dynamics of fuel poverty in rural and urban areas of the UK. In addition to descriptive analysis, discrete hazard models of fuel poverty exit and re-entry are estimated and used to assess the influence of housing and personal characteristics on the time spent in fuel poverty. The results indicate that, on average, the experience of fuel poverty in urban areas is longer with a higher probability of fuel poverty persistence. However, on average the rural fuel poor appear more vulnerable to energy price increases while living in private accommodation or a flat increases their probability of remaining fuel poor relative to their urban counterparts. These results indicate policy effectiveness may differ across rural and urban space. However, they also emphasise the limits of spatial targeting. Monitoring the dynamics of fuel poverty is important for ensuring that policy targets are effective and reaching those most in need.