Though the European Commission has repeatedly stated that the necessary energy transition in Europe should leave “no one behind”, this paper describes a building refurbishment case that has entailed economic hardships for the low-income families involved. The project is located in the area of P. D. Orcasitas in southern Madrid, led by a grassroots neighbours’ movement, comprising one hundred and seven housing blocks, containing more than 2000 dwellings. The main source of funding for the operation consists of subsidies granted by the Madrid City Council; however, Spanish legislation requires the state Agency of Tax Administration to classify these subsidies as capital gains derived from lucrative transfers. Based on the tax data of vulnerable beneficiaries, the conclusion is that the recipients have ended up returning part of the subsidies to the State through their Income Tax Return. In addition, the Spanish Social Security Institute requires the return of social benefits associated with non-contributory retirement pensions and the Minimum Living Income. Apart from tax accounting, regulations are revised to draw conclusions. Unlike most actuations of this kind, in this case the negative effects are obvious. Although intended to alleviate fuel poverty, the initiative has exacerbated vulnerability due to the impact of the imposed penalties on household income. In conclusion, unless preventive measures are implemented, the mandatory refurbishment of inefficient buildings may place an undue burden on vulnerable low-income occupants and hinder the effective implementation of energy-efficiency regulations.
Martín-Consuegra et al. (Thu,) studied this question.
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