Millions default on energy bills as debt hits record high - here's how to get help
More than 2.7 per cent of gas and electricity Direct Debit payments failed in April.
More British households than ever are defaulting on their energy bills, with new figures from the Office for National Statistics (ONS) showing just how tough things are right now. Last month (April), more than 2.7 per cent of gas and electricity direct debits failed because there wasn't enough money in people's accounts.
That's the highest rate since records began in 2019 - and three times higher than before the energy crisis hit. At the same time, more people are missing loan repayments, often taken out to cover everyday costs.
Nearly 3.9 per cent of Direct Debit loan payments failed last month, compared to just over 2 per cent during the pandemic.
Even though the energy price cap has come down slightly this year, millions are still struggling with the impact of last winter's high bills. While the recent unseasonably warm weather means many households are using less energy right now, it hasn't eased the burden for those already in debt.
For people who fell behind over the colder months, lower usage now doesn't undo the damage that's already been done.
Matthew Sheeran, energy expert at Money Wellness, said: 'These figures are deeply worrying, but they're not surprising. More and more people are facing impossible decisions between heating their homes, feeding their families or keeping up with repayments.
'The good news is that help is available, from supplier grants to debt write-offs. The earlier people ask for support, the better their chances of turning things around.'
Financial help to reduce energy debt
Here are six practical tips Money Wellness recommends for getting support with your energy bills.
Apply for energy grants and hardship funds
Most suppliers offer grants to help people struggling with energy bills. These don't need to be paid back and can help clear arrears or reduce future bills. The British Gas Energy Trust, for example, is open to anyone, not just British Gas customers, and has written off thousands of pounds in energy debt.
EDF, Octopus, and E.ON also run similar schemes. You'll usually need to complete a budget form and provide meter readings and income details. Contact your supplier directly to see what's available.
Talk to your supplier as early as possible
It might feel intimidating, but the best thing you can do if you're falling behind is speak to your energy company. They're legally required to help you if you're struggling. That could mean a more manageable payment plan, time to apply for grants, or switching to a better tariff. The earlier you get in touch, the more they can do.
Look into energy efficiency upgrades
Improving how your home uses energy can help reduce bills long-term. The government's Great British Insulation Scheme offers free or discounted insulation and other upgrades if your home has a low energy rating and is in council tax bands A to D. These changes, like better insulation or heating controls, could cut hundreds of pounds a year from your bill. You can check your eligibility online.
Get free debt advice and explore ways to reduce what you owe
If you've got more than just energy debt, speak to a free, regulated debt adviser who can help. Non-profit organisations such as the Citizens Advice network, Christians Against Poverty and the National Debt Helpline offer free, impartial and confidential advice.
Use budgeting tools to stay in control
When money's tight, having a clear view of where it's going can really help. Use a free budgeting tool to help you track spending and spot savings. It might also be useful to see if you're missing out on any benefit support or government grants using a free online checker. Many people discover support they didn't know they were entitled to. Small changes can quickly add up and really help.
Check if you are eligible for the Warm Home Discount
This winter scheme gives £150 off your electricity bill during the colder months. If you get the Guarantee Credit part of Pension Credit, it's applied automatically. Others on low incomes may also qualify, depending on their circumstances. In England and Wales, most people don't need to apply, but in Scotland, you might still need to contact your supplier.
Full details can be found on GOV.UK here.
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