Tag: Energy Bills

Energy debt rises to £5.5bn with further increases expected

A new report by Energy UK has revealed the scale of household energy debt, which has more than doubled over the last three years to reach £5.5 billion.

Arrears now represent around 75% of all unpaid energy bills, meaning there are no repayment plans in place for the majority of this debt, while over one million households currently have no registered details with suppliers, increasing the risk of unmanaged debt.

A spokesperson for the End Fuel Poverty Coalition, said:

“Energy debt has risen for one simple reason: energy bills have remained far higher than household incomes can sustain. This is not a story of widespread ‘won’t pay’ behaviour, it is overwhelmingly about people who simply cannot afford the bills landing on their doormats.

“The real level of financial stress in households in energy debt is likely to be even higher when you factor in people juggling credit cards, borrowing from family, or self-disconnecting on prepayment meters to avoid falling into formal arrears.

“We know from our research in 2024 that households in energy debt also turn to loan sharks due to the cost of energy.

“The human impact is severe. If debts continue on their current trajectory towards £7bn by 2027, we risk locking millions of families into a permanent cycle of fuel poverty.

“It is also increasingly hard to justify a system where the costs of unrecoverable debt are routinely added onto the bills of those who do pay. As Ofgem persists with a methodology that has failed, the energy industry keeps on reporting billions of pounds in profits.

“The priority should be preventing debt building up in the first place. That means urgent progress on debt relief, fairer standing charges, a social tariff for those on the lowest incomes, and a major programme of home energy upgrades to bring bills down for good.”

Energy bills set to fall 7% from 1 April under Ofgem price cap

Ofgem has announced that the average household energy bill will fall by 7% from 1 April 2026.
The impact of the year-on-year changes could see the number of households paying more than 10% of their income on energy fall from 13.2m to 11.2m.
However, the changes will see energy bills remain £599 (57%) above winter 2020/21 and £73 (5%) above what they were on 1 July 2024.
Significant changes to unit costs and standing charges will take effect from 1 April 2026 and initial analysis suggests some households will see much bigger reductions than others.
A low usage household will see their bill reduce by around £80, while high usage households might see a £140 saving.
Using data from Scope and Mencap, the End Fuel Poverty Coalition has calculated that those reliant on energy for disability or health needs could see even greater savings, but will still experience a 64% ‘energy poverty premium’ with a typical bill much higher for these groups.
It remains unclear when and how energy firms will start to reflect these changes in the rates they advertise. The Government is expected to make a further announcement next month.
Simon Francis, coordinator of the End Fuel Poverty Coalition, said:
“Government decisions are starting to make a difference and today’s fall in the price cap will bring some welcome relief to households who have been under intense pressure from high energy costs.
“But, of course, bills remain hundreds of pounds above pre-crisis levels and for millions of families in cold, damp homes this will not feel like the cost of living crisis is over. If the country is going to tackle energy affordability for good, this must be the start of deeper reform, not the end of the job.
“That means bearing down on excessive market trading costs, dealing with the growing mountain of energy debt, taking a hard look at how infrastructure costs are recovered from households and doing more work to reduce exposure to volatile gas prices.
“At the same time, the energy industry and its ultimate owners, including hedge funds and overseas investors, must continue to face scrutiny for the healthy profits made at the expense of households
“With the changes to both unit rates and standing charges still working through the system, consumers may need to be cautious about rushing into fixed deals right now. Bill payers may want to wait for the dust to settle and carefully check their specific usage to ensure any switch delivers the maximum savings.”
Hannah Wall, Community Heat & Energy Lead at climate charity Possible, said:
“Lowering the energy price cap by removing levies from customers’ bills is a welcome step forwards to support people who have been struggling with high bills. But far too many people are still living in energy poverty, and face impossible choices to keep their homes warm.
“Energy bills remain significantly higher than they were before the energy crisis, driven by soaring gas costs. The structure of our energy system still leaves us exposed to volatile fossil fuel prices. It’s unfair that our electricity bills continue to be tied to global gas markets, creating a distortion that makes it harder for people to switch to clean electric heating, which should be cheaper than dirty gas.
“We need faster action from the government to deliver promised reforms to the electricity market to ensure everyone can afford a warm home powered by clean, climate-friendly heat and energy.”
Independent Age chief executive Joanna Elson, CBE, said:
“Today’s energy price cap announcement will provide some brief respite for the older people in financial hardship, as a typical household energy bill is dropping by almost seven per cent to £1,641 from April.
“However, energy bills are still extremely high, and the older people on low incomes we support are seeing their budgets stretched beyond breaking point.
“This winter has been brutal, we have heard dreadful accounts of people in later life sitting in cold, dark homes, or cutting back on other essentials such as food so they can turn a radiator on.
“This poses a health risk to older adults and cannot be allowed to continue happening.
“There are immediate and long-term actions the UK Government can take to support people on low incomes who cannot afford to heat their homes.
“The recent Warm Home Discount extension was welcome, but at £150, it does not go far enough in supporting those in financial hardship.
“We want to see it increased to £400 to match the high cost of energy bills.
“Targeted bill support is also needed in the form of an energy social tariff that protects customers on low incomes from future spikes in costs.
“If the UK Government is serious about tackling the cost of living and raising living standards, it should take meaningful action to lift people out of fuel poverty.”
Jonathan Bean from Fuel Poverty Action, commented:
“Customers should not be fooled: energy bills are still £600 higher than 5 years ago, meaning the suffering will continue for millions of us.
“Up to £500 of our bills is energy firm profits which means that Ofgem and the Government are failing to protect us.
“We especially need a fairer deal on electricity pricing which is four times higher than gas, despite wind and solar energy being cheaper.”
James Taylor, director of strategy at Scope, added:
“Life costs a lot more if you’re disabled. The need to run lifesaving equipment or keep the heating on year-round means bills continue to be steep.
“We’re calling on Ofgem to do much more to protect disabled customers, and for the government to introduce a discounted energy deal for disabled people.”
Uplift Deputy Director Robert Palmer said:

“This is welcome news for millions of households as it shows the UK is starting to turn a corner on energy bills.

“Weaning ourselves off volatile gas is the only real long term route to affordable energy bills and last year we generated record-breaking amounts of renewable energy, with wind power cutting the wholesale cost of electricity by almost a third.
“Compare this to America where Donald Trump is blocking renewable energy and doubling down on fossil fuels, and electricity bills are rising.
“Today’s Price Cap shows we’re on the right path. It’s not just our bills that are benefitting from more renewables, our planet will too. This is a change that cannot come soon enough as already we’re seeing the impacts of climate change caused by our oil and gas dependency and the costs it imposes on everyone, whether that’s flooded homes and businesses or rising food prices.”

Energy bills likely to fall by over £100 from 1 April

Cornwall Insight’s latest price cap prediction would suggest average energy bills will fall by £117 from 1 April to £1,641.

This represents an increase from their previous prediction (£1,620), caused by the spike in gas prices earlier this year. If Ofgem confirms this prediction, it will still leave average energy bills £599 above pre crisis levels and £73 above the level at 1 July 2024.

A spokesperson for the End Fuel Poverty Coalition, commented:

“The April price cap will see one of the biggest changes in the make-up of energy bills in recent years.

“Budget decisions to remove costs from bills and Government moves to alter how the Warm Home Discount is paid for, will mean changes across standing charges and unit costs. Even those on fixed tariffs will need to look carefully to check that energy firms pass on the changes and potential savings to these customers.

“Meanwhile, volatile gas prices earlier this year also make the wholesale element subject to uncertainty and may create an upward pressure on bills for those on the standard variable tariff.

“Households will need to keep a close eye on Ofgem’s announcement next week and pay careful attention to the changes in unit costs and standing charges, rather than focus on the headline ‘average energy bill’ figure.”

Uplift Deputy Director Robert Palmer said:

“Predictions that energy bills will fall in April suggest that the UK is starting to turn a corner on energy bills.

“Last year we generated record-breaking amounts of renewable energy, with wind power replacing gas and reducing the wholesale cost of electricity by a third. This was partly possible because of the government’s clean power plan.

“The only real, long-term route to lowering bills is to get off volatile gas, whether that’s supplied by Putin, Trump’s America or profit-hungry oil and gas companies.

“It’s not just our bills that will benefit from more renewables, it’s our planet. Already we’re seeing the impacts of climate change caused by our oil and gas dependency and the costs it imposes on everyone, whether that’s flooded homes and businesses or rising food prices.”

Windfall Tax in the firing line as Blair Think Tank backs energy industry

The Tony Blair Institute has repeated its call for an expansion of gas production in the North Sea and an end to the energy firm Windfall Tax.

The think tank has links to the Saudi government, the United Arab Emirates, Elon Musk’s Starlink [pdf, p8] and Trump apply Larry Ellison.

A spokesperson for the End Fuel Poverty Coalition, commented:

“The Tony Blair Institute’s so-called ‘reset’ looks less like a fresh start and more like a defence of fossil fuels and an energy industry that has made over £125bn in UK profits since 2020.

“For the Institute to call for the Windfall Tax to be scrapped, while energy giants post extraordinary profits and millions live in cold, damp homes, is staggering. That tax exists because companies benefited from a crisis that devastated household finances.

“Removing the Windfall Tax would reward profiteering and shift the burden back onto households that are still paying the price of Britain’s over-reliance on gas.

“It was exposure to volatile global fossil fuel marketsthat sent bills through the roof, not climate targets and doubling down on new North Sea exploration will not lower bills.

“Gas is sold at international prices and the North Sea is a declining geological resource that cannot meet the country’s heating needs in the long term. The answer to high bills lies in accelerating homegrown renewables, reforming electricity pricing and investing in energy efficiency, not returning to the solutions of the past.”

Jess Ralston from the Energy and Climate Information Unit said:

“With many households still facing debts from the gas crisis of the past few years, focussing on bringing down bills is particularly key for them. Electrification, through the adoption of net zero technologies like heat pumps and EVs, will gradually reduce our vulnerability to the volatility of international oil and gas prices.

While the thrust of this report is around cheaper power, it’s not clear how many of its recommendations will lower bills. More drilling in the North Sea won’t make any real difference to the gas bills British homes pay because it’s international markets driven by Putin and Trump that dictate the price. The regulator’s own analysis shows more drilling will make very little difference to how steeply North Sea output continues to decline.

“Renewable wind power lowered the wholesale power price by around a third in 2025, squeezing more expensive gas power off the system. Every wind turbine we build or solar panel we install means the UK is less dependent on gas imports and less vulnerable to volatility in the gas price. We don’t have to import wind or sunshine.”

Meanwhile a spokesperson from the Green Alliance think tank added:

“We don’t need to rethink a clean power plan that’s working – the UK generated record-breaking amounts of renewable energy last year, and wind power replacing gas cut the wholesale cost of electricity by a third. Tony Blair’s think tank rightly points out that we need to make sure businesses and families save as a result, but gives few suggestions for how to do this. Given the former politician’s extensive ties to petrostates and oil and gas firms, it’s a bad look to see his institute call for more drilling in the North Sea, which will do nothing for our energy security.”

Warm Home Discount extended across GB through to winter 2030/31

The £150 Warm Home Discount will be provided to eligible households every winter until 2030/1.

It follows the expansion of the Warm Home Discount last year, adding 2.7 million families to the scheme and bringing the total number of eligible households to around six million.

In England and Wales, households who are receiving a qualifying means-tested benefit should get the discount automatically.

In Scotland, the UK Government has implied that significant changes are expected. While an estimated 345,000 Scottish households will receive it automatically, some who previously received the benefit may now miss out.

A spokesperson for the End Fuel Poverty Coalition, commented:

“As gas prices continue to demonstrate their volatility, reaching an 11-month high in recent days, keeping the Warm Home Discount in place avoids a damaging cliff-edge for households struggling through a fifth winter of the energy bills crisis.

“But simply rolling it forward at the same level, with the same rules, risks locking in a scheme that we already know doesn’t reach everyone who needs help.

“If Ministers intend the Warm Home Discount to be the backbone of energy bill support to 2030, they cannot freeze it in its current form.

“Right now, too many people are left out altogether or not given enough support to make a meaningful difference. This includes households with electric-only heating, people living off the gas grid, residents of park homes and private networks, and families facing much higher costs because of disability, illness or poor housing.

“Without uplifts for high-cost households and a clear application route for those not captured by the main scheme, it will continue to miss large numbers of people in genuine fuel poverty.

“Industry Initiatives must also be properly funded and strengthened to catch those the support excludes, including people on non-standard supplies and those with additional health needs. And in Scotland, any move to automatic data-matching must be matched by expanded Industry Initiatives, clear supplier duties, and close monitoring to ensure households who previously qualified do not quietly lose support.”

The Coalition’s full response to the Government’s consultation on this issue is available as a pdf.

Heat network customers to see increase in protections

More than 500,000 heat network customers will receive greater consumer protections across England, Scotland and Wales.

Ofgem will now have powers to act if a heat network operator puts up prices unfairly, and if an operator delivers a poor level of service, with compensation awarded to customers who suffer a service outage through the Energy Ombudsman.

Homes and businesses on heat networks will receive clearer, itemised billing – with previous cases of customers being issued with an unexplained monthly charge – and there will be greater support for vulnerable customers.

Some heat network customers saw energy prices rises of up to 450% during the energy bills crisis.

A spokesperson for the End Fuel Poverty Coalition, commented:
“Bringing heat networks under Ofgem regulation is an important and long-overdue step. These networks should be able to deliver low cost energy for some of the poorest households in the country, but for years, heat network customers have effectively been second-class energy consumers, facing huge price hikes, poor service and little meaningful protection.

“Today’s change should finally give heat network customers basic rights around fair pricing, clear billing and redress when things go wrong. But regulation alone won’t fix everything. Ofgem and Ministers must now make sure these powers are used robustly, vulnerable households are properly protected, and that heat networks genuinely deliver what they promise: affordable, reliable heat that helps tackle fuel poverty, not deepen it.”

Warm Homes Plan launched to upgrade homes and cut energy bills

The Government’s £15bn Warm Homes Plan promises to tackle fuel poverty, cut bills and reduce emissions through three main pillars:

  • Targeted support for low-income households,
  • A universal loan offer for solar panels, batteries and heat pumps, and
  • New protections for renters living in cold, damp, or mouldy homes.

Campaigners have welcomed the Plan with its potential to improve conditions in the coldest homes, through insulation, heat pumps and solar panels. Although its success in reducing fuel poverty will be judged on real delivery, strong consumer protections and a focus on the people most in need.

A spokesperson for the End Fuel Poverty Coalition commented:

“The lifeblood of the Plan amounts to a rescue mission for the coldest, dampest homes in Britain – and this must be the priority.

“Combined with long-overdue improvements to conditions in the private rented sector, it could save lives, cut NHS costs and permanently slash energy bills for those in fuel poverty.

“Achieving this, while also inspiring a rooftop and heat pump revolution through loans and subsidies, will require a national effort. There will also need to be reforms which go beyond this Plan, such as bringing down the cost of electricity and providing financial support with energy costs while households wait for improvements to be installed.

“Above all, any use of public funds must come with a Warm Homes Guarantee, built around quality advice on the right installations to deliver, enhanced consumer protections and a promise that every upgraded home will see bills come down.

”If delivery matches ambition then this could be the biggest breakthrough in tackling cold damp homes in a generation, but now the hard work begins.”

Adam Scorer, Chief Executive at National Energy Action, added:

“People struggling in fuel poverty desperately need the Warm Homes Plan. Cheaper energy costs, efficient heating systems and homes that keep the warmth in, are all essential for the plan to succeed. There is a lot of work to be done, but today’s publication and commitment to lift a million households out of fuel poverty is a welcome, landmark occasion.”

Tessa Khan, executive director of Uplift, said

“A Warm Homes Plan is desperately needed, with world events once again highlighting the UK’s vulnerability from our over-reliance on gas for heating.

“Ending this dependency, by ensuring our homes are more energy efficient – particularly for those on lowest incomes – and powered by renewable energy, is both pragmatic and the right thing to do for ensuring we have affordable energy.

“We can no longer bank on the North Sea because, after 50 years of drilling, the UK has now burned most of its gas. Regardless of any new drilling, the UK will be dependent on gas imports for nearly two thirds of its gas in just five years time and almost 100 per cent by 2050, unless we shift away from gas.

“An ambitious warm homes plan, properly implemented, will reduce our exposure to price shocks and mean we are not at the mercy of bad actors like Putin or the whims of Trump.”

Nick Davies, Head of Climate Policy at Green Alliance, said:

“Everyone has a chance to lower their energy bills with clean technologies under the government’s new Warm Homes Plan. That’s critical because rollercoaster global gas prices have fuelled a cost of living crisis which means energy bills remain far too high.

“Supporting more households to afford the upfront costs of installing solar panels or switching to ultra-efficient electric heat pumps will help to cut bills, reduce our reliance on imported gas and keep the climate safe for our children.”

Years of new North Sea licenses produced 36 days of gas

New analysis by energy consultancy Voar shows that hundreds of oil and gas licences handed out by the previous government have delivered almost nothing in return.

Research by energy consultancy Voar found that seven licensing rounds between 2010 and 2024 led to just 20 new and re-licensed fields, which together have so far produced the equivalent of just 36 days of gas.

Even over their full lifetimes, those fields are expected to deliver less than six months of gas in total. Polling now shows public support for this shift, with a majority of Scots surveyed backing a move away from oil and gas and strong support for prioritising clean energy as the route to long-term jobs and investment.

Meanwhile, the chair of the Scottish Affairs Committee of MPs has claimed the Government should weaken the windfall tax on oil and gas companies, despite ministers reaffirming that the Energy Profits Levy will remain in place until March 2030 at the latest and be replaced by a reformed mechanism thereafter

A spokesperson for the End Fuel Poverty Coalition, commented:

“There is a real risk to households in clinging to a broken system that delivers high bills and volatile prices as the North Sea runs out of gas.

“Hundreds of licences handed out over the past decade have delivered barely a month’s worth of gas, while oil and gas jobs have more than halved. This industry is in geological decline, whether politicians like it or not

“Despite this, just 27 energy firms have made around £40 billion in UK profits in the last two years, even with the Energy Profits Levy in place. That is why the levy must continue, and why it must be followed by a stronger, reformed mechanism after 2030 that ensures energy companies contribute fairly while households are still struggling.

“But taxation alone is not enough. The UK needs a properly funded plan to manage the decline of the North Sea in a way that protects workers and communities, cuts bills, invests in clean energy and upgrades cold, leaky homes.

“The real test now is whether politicians will commit to delivering secure jobs, affordable energy and an end to fuel poverty, or if they allow the same broken system to keep failing people.”

No new levies on gas bills promises Minister

Efforts to cut energy bills and warm homes will not come with a new gas bills levy as had been reported over the festive period.

Speaking in the House of Commons, the Energy Secretary labelled news reports of a new charge “absolute nonsense”. Ministers also repeatedly vowed to publish the Government’s Warm Homes Plan and fuel poverty strategy “soon”.

A spokesperson for the End Fuel Poverty Coalition, commented:

“It’s a relief to hear that recent media reports of a new levy on gas bills were not based in any reality.

“With around a fifth of fuel poor homes suffering from high levels of carbon monoxide due in part to ageing gas boilers and the North Sea basin in geological decline and unable to provide enough gas to heat our homes from 2027, it’s clear we need to move away from gas as our main heating source in the long term.

“While bringing down electricity prices is key to this, there are plenty of other options the Secretary of State should consider before putting up gas bills. For example, we could see GB Energy invest in infrastructure so some of these costs could be taken off bills. The Government could reform how electricity pricing is set and reduce the impact of the role of energy market trading on prices. And the Treasury could step in and use the receipts from the Windfall Tax to wipe out the record levels of energy debt built up by households due to the profiteering by the energy industry during the crisis.

“These sort of changes would deliver lower energy bills and a fairer energy system for everyone.”

Cold crisis as one in three struggle to heat their homes

Figures show that 29% of adults are unable to keep their home at the recommended minimum temperature of 18°C, the level advised by World Health Organisation experts to reduce the risk of illness.

Reports in the Express reveal that among those affected are around 3.2m (23%) older people (aged 65+) who say they struggle to keep their home warm enough.

As energy bills remain 69% higher than in winter 2020, the End Fuel Poverty Coalition polling from Opinium shows that the problem is particularly acute among households on incomes below £40,000 and people living with long-term health conditions, including lung conditions and physical disabilities.

A spokesperson for the End Fuel Poverty Coalition, commented:

“It’s shocking that after years of warnings, so many people are still stuck in homes that put their health at risk. No one should be facing winter worried about whether their home is warm enough.

“We urgently need to see further action to bring down the cost of energy in the new year, especially on electricity which is homegrown and should be much cheaper than it currently is.

“One sign of hope is that we know that households are taking action to look at how they can make their homes more energy efficient, but they need help to do this. Every week of delay to the Government’s much promised Warm Homes Plan means households are stuck in cold, damp homes for longer.”

Charlotte Higgins is retired and lives in Solihull in the West Midlands and had energy-saving measures fitted by the Solihull Household Support Fund. She said: “The loft insulation has been done, and I’ve had solar panels on the front and the back. It’s made a difference to my heating, and my bills are a lot cheaper.”

Jan Shortt, General Secretary of the National Pensioners Convention said: “With energy bills hundreds of pounds a year higher than they were in 2020, there is a real danger of older people falling ill through living in cold, damp homes.

“Whilst some older people receive the winter fuel payment, others do not. Some receive the warm homes discount on their bill, others do not. Even with this small income, it is hard to keep a house warm in really cold, wintry weather.

“The cost of energy has another cost – that of overflowing A&E departments, wards and GP surgeries. Not being able to heat your home does not just mean you are susceptible to colds and flu but also to respiratory conditions, heart disease, arthritis and other health conditions that demand individuals keep warm.

“We need to ensure that everything is being done to insulate homes, find alternative and sustainable sources of energy.”