What are the criteria to determine consumer vulnerability?

Vulnerable consumers are defined or categorised in several ways across countries. In terms of a generic definition, academics Andreasen and Manning defined them in the following way in 1990.

“Vulnerable customers are those who are at a disadvantage in exchange relationships when that disadvantage is attributable to characteristics that are largely not controllable by them at the time of the transaction.”

In official definitions vulnerable consumers are generally identified in most countries based on demographic characteristics. The most common are:
  • Age
  • Income
  • Employment status
  • Health
  • Education levels
  • Housing situation (owning, renting, public housing)
Other characteristics that many indicate vulnerability in energy markets include:

Urban or rural location: In some countries remote regions have higher energy costs and socio economic disadvantages.

Gender: In many countries, gender has implications for employment status.

Household size: Support mechanisms need to consider how many consumers in a household are covered by the vulnerable consumer intervention.

Climate: Particularly in colder climates, equitable and affordable access to energy for heating by vulnerable consumers can be a matter of life or death.

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