New figures from Ofgem have revealed that the number of customers disconnecting from the grid have surged – along with levels of energy debt.
The data shows that in quarter 1 2023, people disconnected from their energy supply more than 5 million times. Almost 1.2m customers were affected with over 800,000 bill-payers disconnecting for more than three hours.
Meanwhile, official energy debt levels have also surged.
The average household energy debt for homes not on a payment plan, is £1,214 on electricity bills and £965 on gas bills. Figures from the Money Advice Trust suggest that this “bad debt” is just the tip of the iceberg.
A spokesperson for the End Fuel Poverty Coalition commented:
“This is exactly what we have been fearing. As Bank of England figures show, people have burned through savings just to keep up with essentials and the cost of living crisis continues. Meanwhile average energy debt is surging to unprecedented levels
“It’s clear that households are just unable to cope.
“The majority of this debt is caused by the record high energy prices which have caused misery for millions, but generated excess profits for the firms involved in Britain’s broken energy system.
“Rather than end the Windfall Tax early, as the Government plans to do, it should instead look at how this could be used to help get those people suffering back on an even keel.
“Calls to introduce a Help to Repay debt matching scheme are backed by a range of charities. These plans would help reduce levels of fuel poverty as well as helping wider household finances.”
The figures come as the Ofgem Price Cap brings the average annual energy bill to customers down to around £2,074 from 1 July 2023. The Price Cap affects 29 million customers on standard variable tariffs (SVTs), including around 4 million customers on prepayment meters (PPMs).
Despite a slight reduction in bills from 1 July 2023, these customers will have energy bills that are double what they were in 2020 and 60% above what they were before the invasion of Ukraine.
This means that customers will continue to pay similar amounts for their energy as last winter, but with people having less ability to pay as the cost of living crisis continues.