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What Are the Benefits of Government Assistance with Household Energy Bills? Evidence from Ukraine

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dc.contributor.authorAlberini, Anna
dc.contributor.authorUmapathi, Nithin
dc.date.accessioned2021-06-01T21:54:02Z
dc.date.available2021-06-01T21:54:02Z
dc.date.issued2021-05
dc.description.abstractIn April 2015, the Government of Ukraine abruptly raised the tariffs of natural gas to residential customers, which were previously well below the cost of acquiring gas and delivering it to households. The tariff increase—700 percent—caused considerable distress to the population and led the government to scale up its existing energy assistance program, the housing and utilities subsidy program. This paper examines the welfare effect of the program and potential redesigns of the program. Using several waves of Ukraine’s Household Budget Survey, the analysis finds that electricity, gas, and fuels account for a considerable share of household income. After the tariff hike, the average household that did not receive the housing and utilities subsidy spends 11 percent of its income on electricity, gas, and fuels, implying that it meets the definition of “fuel poor.” The average share for households that do receive the subsidy is 6–8 percent. The housing and utilities subsidy cuts the rate of fuel poverty in half. It also brings considerable consumer surplus gains of 6–7 percent of income. This comes at a high price tag for the government, as the budget for the housing and utilities subsidy is 1–2.5 percent of gross domestic product. Considerable savings would be achieved with only a small loss of consumer surplus if the housing and utilities subsidy was cut in half. Linking the subsidy solely to income would also attain considerable savings, but at a high loss of welfare. The housing and utilities subsidy could also be paired with social tariffs, or an energy efficiency subsidy, with major savings for the government.en
dc.identifierhttp://documents.worldbank.org/curated/en/747101621621225723/What-Are-the-Benefits-of-Government-Assistance-with-Household-Energy-Bills-Evidence-from-Ukraine
dc.identifier.doi10.1596/1813-9450-9669
dc.identifier.urihttps://hdl.handle.net/10986/35630
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 9669
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectFUEL SUBSIDY
dc.subjectENERGY ASSISTANCE
dc.subjectCONSUMER WELFARE
dc.subjectFUEL POVERTY
dc.subjectNATURAL GAS
dc.subjectFUEL PRICE
dc.subjectENERGY EFFICIENCY
dc.titleWhat Are the Benefits of Government Assistance with Household Energy Bills? Evidence from Ukraineen
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.crossref.titleWhat are the Benefits of Government Assistance with Household Energy Bills ? Evidence from Ukraine
okr.date.disclosure2021-05-21
okr.date.doiregistration2025-04-10T09:38:14.757772Z
okr.doctypePublications & Research
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://documents.worldbank.org/curated/en/747101621621225723/What-Are-the-Benefits-of-Government-Assistance-with-Household-Energy-Bills-Evidence-from-Ukraine
okr.guid747101621621225723
okr.identifier.doi10.1596/1813-9450-9669
okr.identifier.externaldocumentum090224b088603d2f_2_0
okr.identifier.internaldocumentum33100872
okr.identifier.reportWPS9669
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/747101621621225723/pdf/What-Are-the-Benefits-of-Government-Assistance-with-Household-Energy-Bills-Evidence-from-Ukraine.pdfen
okr.region.administrativeEurope and Central Asia
okr.region.countryUkraine
okr.topicEnergy::Electric Power
okr.topicEnergy::Energy Consumption
okr.topicEnergy::Energy Demand
okr.topicEnergy::Energy Policies & Economics
okr.topicEnergy::Oil & Gas
okr.topicMacroeconomics and Economic Growth::Taxation & Subsidies
okr.unitSocial Protection and Jobs Global Practice
relation.isAuthorOfPublication6d5b74f7-f0e4-5a8c-825d-ac1ca67320f5
relation.isAuthorOfPublication.latestForDiscovery6d5b74f7-f0e4-5a8c-825d-ac1ca67320f5
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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