Russia-Ukraine war has nearly doubled household energy costs worldwide: New study

The Russia-Ukraine war has doubled household energy costs worldwide, says a new study.

The study published in Nature Energy notes that rising energy prices are making households more vulnerable to energy poverty, particularly during the winter. It outlines that since the war, energy prices have increased sharply but to varying degrees, depending on the type of fuel.

Researchers modeled the direct and indirect impacts of increased energy prices in 116 countries, covering 87.4 per cent of the global population. The direct impacts include the aggravated costs of heating, cooling, lighting and mobility and the indirect impacts can be in the form of the cost of transport and essential goods.

The study observed that total energy costs (direct and indirect) for households have increased as much as 113 per cent. This has contributed to an increase of 2.7 per cent-4.8 per cent in global household expenditure forcing households to find other sources of income just to maintain their current living standards.

In some countries in sub-Saharan Africa, household energy costs increased by up to three times the global average. The cost of fuel has indirectly pushed up the costs of other goods and services throughout the global supply chain, pushing more households into poverty.

As per the new study, 78-141 million people could be pushed below the World Bank’s extreme poverty line. The energy price increase due to the Russian-Ukraine war would not have had such an extreme impact if not for over-dependence on fossil fuels.

Despite multiple global treaties and agreements to reduce carbon emissions, the slow and hesitant progress in the energy transition is reflected in the dependency on fossil fuel imports and has amplified the severity of the cost-of-living crisis.