Energy poverty and health: Evidence from European countries

We estimate the effect of energy poverty on a range of subjective and objective health outcomes among older Europeans using ex-ante harmonized microdata from the Survey of Health, Ageing and Retirement in Europe. To address potential endogeneity concerns, we exploit regional weather-based Eurostat data on Heating Degree Days to construct two instrumental variables for energy poverty. Our findings indicate that energy poverty has detrimental effects on both physical and mental health. Ordinary Least Squares estimates show that individuals experiencing energy poverty are more likely to report poor health, chronic lung conditions, and score higher on assessments of depressive symptoms and cognitive decline, while also displaying lower grip strength and a higher probability of sarcopenia. Instrumental variable estimates confirm a clinically significant negative effect on physical health, with energy poverty substantially reducing grip strength among older individuals. From a policy perspective, our results highlight the importance of integrating energy affordability into climate and decarbonization strategies. Policies that increase residential energy costs without adequate compensatory measures may unintentionally worsen heating deprivation and generate adverse health consequences, particularly within ageing societies.