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Subsidies provided last year decreased energy poverty level by 43%, study

Over 60% of the households in Moldova are affected by energy poverty. The energy subsidies provided last year decreased the energy poverty level by 43% and had an impact in the case of the most vulnerable families, shows a UNDP study that was presented in an international conference entitled “Tackling energy poverty in Europe: challenges, lessons learned and ways forward. Moldova’s case” that is held in Chisinau on June 29-30, IPN reports.

“Owing to the support of Moldova’s friends and with our joint efforts, through the agency of the Energy Vulnerability Reduction Fund we covered half of the gas and electricity bills for our citizens. We aim to increase energy efficiency and to improve the bill subsidization mechanism so as to make it more equitable and to ensure the largest subsidies are received by families that need support the most,” Prime Minister Dorin Recean stated in the event.

“The rise in energy prices the past two years affected the living standards of the population that has been already confronted with a series of difficulties. But we weren’t defeated. On the contrary, we worked continuously to offset the crisis, continuing simultaneously the structural reforms. I’m grateful to all the countries and international organizations that supported us in these efforts,” said Minister of Labor and Social Protection Alexei Buzu.

“The recent assessment of the impact of the Energy Vulnerability Reduction Fund, which was carried out by UNDP and the Government, revealed a positive impact of the subsidies on the reduction of energy poverty, monetary poverty and promising results as regards the subsidies’ impact on energy consumption,” said Ivana Živković, Director of the UNDP Regional Bureay for Europe and the Commonwealth of Independent States.

To cope with the energy crisis, with the support of the development partners, the Government in July 2022 constituted the Energy Vulnerability Reduction Fund from which targeted subsidies were provided to five categories of vulnerable consumers. The criteria used to assess the energy poverty of households included the incomes, ratio of incomes to costs for energy, type of the heating system, and composition of the family. In 2022-2023, the Fund was 5.87 billion lei.

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