New energy debt strategy aims to help households struggling with bills

The Government and energy regulator Ofgem have published a joint strategy to address Britain’s growing household energy debt. The plan includes proposals for targeted debt relief, improved payment arrangements and stronger support for vulnerable customers. A new Debt Relief Scheme is expected to launch in 2027, subject to consultation.

How much do UK households owe energy suppliers?

According to the strategy, domestic energy debt in Great Britain reached approximately £5 billion during the second quarter of 2026.

That is around three times the level recorded in 2021.

More than two million households are currently in energy debt or arrears.

The Government and Ofgem acknowledge that higher energy prices have made it increasingly difficult for some households to keep up with essential bills.

The consequences extend beyond individual customers.

Unpaid energy debt can increase costs across the wider market, with suppliers having to recover and manage outstanding balances.

What is the proposed Debt Relief Scheme?

The strategy includes plans for targeted, one-off debt relief for certain vulnerable households.

The Government has indicated that the proposed scheme will focus on eligible customers who accumulated debt during the energy crisis and who take steps to re-engage with their energy supplier.

Potentially eligible groups include households receiving means-tested or disability benefits and pensioners.

However, the scheme’s final design remains subject to consultation.

Ofgem expects to consult further before the end of 2026, with implementation planned for 2027.

Households should not assume that existing energy debts will automatically be cancelled.

Will the Priority Services Register change?

The strategy also confirms a review of the Priority Services Register.

This register helps energy companies identify customers who may need additional assistance because of age, disability, medical needs or other circumstances.

The review will examine how vulnerable customers can be identified and supported more effectively.

This is particularly relevant during power interruptions, when some households may require additional communication or assistance.

What should households do if they are struggling?

Anyone having difficulty paying energy bills should contact their supplier rather than waiting for arrears to increase.

Suppliers may be able to discuss affordable repayment arrangements and identify available support.

Independent debt advice can also help households assess their options.

For those concerned about both energy affordability and supply interruptions, it is worth reviewing the household’s emergency arrangements.

Prepper Weekly’s household emergency planning guide explains how to identify essential services, important contacts and practical contingency arrangements.

Source: Government and Ofgem: Energy debt circuit breaker strategy. Published 28 October 2026.