Summary
Nearly 200,000 people receiving benefits in the UK might have their energy debts cancelled if they contribute toward their bills. This plan by regulator Ofgem could cost around £500 million and would involve adding £5 to each household's energy bill. The scheme aims to address a significant rise in energy debt, which has reached £4.4 billion.
Key Facts
- Around 200,000 people on benefits in the UK could have their energy debt cancelled under a new plan.
- To qualify, participants must have built up over £100 in debt between April 2022 and March 2024.
- Eligible individuals need to make some payment towards their debts or agree to financial guidance from a debt charity.
- Energy debt in England, Wales, and Scotland has increased by £750 million in one year, reaching £4.4 billion.
- Ofgem proposes adding a £5 charge to all household energy bills to finance the debt relief.
- More than one million UK households currently have no debt repayment arrangements.
- The Energy Security and Net Zero Committee suggests using energy companies' excess profits to clear debts.
- Ofgem also plans to require new tenants and homeowners to register energy accounts to prevent anonymous debt accumulation.
