Millions of households across the United Kingdom are bracing for a significant increase in energy prices this winter, with projections indicating the highest costs in three years. The average billpayer is already facing charges hundreds of pounds higher annually than before Russia's invasion of Ukraine in 2022, which triggered the current energy crisis. Industry data shows bills have risen by approximately 70% compared to pre-crisis levels.
This sharp increase in costs has led to a dramatic surge in unpaid bills and outstanding charges. Energy UK estimates that the total collective debt owed by households has already reached £6 billion and is expected to climb to around £7 billion by the end of the year. For households in debt and without a payment plan, the average amount owed stands at £3,500, according to the trade body.
Advocacy groups are urging for government intervention to mitigate the impact on vulnerable households. Emily Whitford, senior public policy advocate at StepChange, stated, "Without urgent intervention – namely a national social tariff and implementation of the long-awaited debt write off scheme from Ofgem – we expect this [debt] figure to rise in the coming months, and with that see an increase in the number of people coming to us for help with energy bills." Energy UK also supports the implementation of a flexible discounted tariff for those most in need, funded through taxation, a proposal echoed by many debt charities.
The Trades Union Congress has called for a windfall tax on bank profits to be redirected towards reducing energy bills. While the government is implementing a cut in VAT on electricity bills in October, expected to save the average household around £50 annually, and has already adjusted or cancelled some policy costs, ministers acknowledge that further action is required.
Energy suppliers offer various support schemes for customers experiencing or anticipating difficulties in paying their bills. Energy UK maintains a list of these schemes but emphasizes that customers often need to contact their supplier directly to inform them of their inability to pay for the company to provide assistance.
