UK Households Owe Record £4.8 Billion to Energy Companies

The UK's energy debt has more than quadrupled since 2018.

Brits owe almost £4.8 billion to energy suppliers. Many households are struggling with high bills.

The debt mountain rose by £240 million to a record high in the first three months of this year.

The energy price cap will increase by 13% to £1,862 a year from next week. This is an increase of £221, or £18 a month.

Ofgem says affordability challenges are the main reason for the rise in debts. Households that don't owe money still pay an extra £50 on their annual bill.

Most energy debt is from households that are at least three months behind with payments.

The average number of electricity accounts in debt has risen by 3% to 852,000. Gas accounts in debt have risen by 4% to 710,000.

For those without a repayment plan, the average amount owed for electricity is £1,876. For gas, it is £1,623.

Customers with a repayment plan owe less: £828 for electricity and £679 for gas. Many households are struggling to make ends meet.

The overall debt has more than quadrupled since 2018, from £1.1 billion to £4.79 billion. Most is from customers who are at least three months behind with payments.

Customers in debt owe less once they have a repayment plan in place.

James Mabey from National Energy Action says the rise in energy debt is deeply worrying. It causes cold homes, anxiety, and impossible choices.

Allowing debt to persist increases costs and harms households. The right response is to scale debt relief, says Mabey.

Gillian Cooper from Citizens Advice says the growth in energy debt is extremely worrying. It's not a surprise, given the 70% increase in households seeking help since 2021.

The government needs to act to stop debt levels from continuing to rise. It should support Ofgem's Debt Relief Scheme to help millions in need.

Ofgem is moving to tackle one of the biggest causes of energy debts. It plans to publish proposals later this summer to address the issue of accounts being switched to 'the occupier' when a billpayer leaves a property.

Neil Kenward from Ofgem says energy debt is continuing to rise, putting pressure on households and limiting the industry's ability to invest and innovate.

Kenward says this is a complex issue that needs a balanced and coordinated programme of activity across the industry to stabilise debt levels.

Ofgem's priority is creating a fair system for everyone. It is taking regulatory action and looking at support for households that need it most.

COPYRIGHT DISCLAIMERS

4English does not own the rights to this content. All rights belong to the owner. 4English only uses this content to help users learn English via the app's features. Contact to request the removal of your content: contact@4englishapp.com.

Latihan mendengarkan

Latihan mendengarkan