The evaluation of the policy response to energy price shock in Poland

This paper evaluates the impact of the 2022 energy price shock on Polish households and assesses the distributional effects of the government’s policy response. Using microdata from the Polish Household Budget Survey and the energy module, a price-shock scenario based on external cost increases is simulated, followed by a policy response scenario including energy subsidies, means-tested income support, regulated prices, and tax reductions. The findings show that poorer households were most affected by price increases with energy expenditures rising up to 20% of disposable income. Targeted subsidies and gas price regulations significantly mitigated the burden, while tax relief had a modest equalising effect.