Household energy debt in the UK is expected to reach a record £7 billion by the end of 2026, according to figures from Energy UK.
The trade body estimates domestic energy debt reached around £6 billion in the first half of the year, with more than three million customers now in debt or arrears. The average amount owed is approximately £1,800.
Energy UK warned that debt could continue rising as the energy price cap is increased by 4% this October.
Unpaid bills are already adding to household energy costs, with bad debt estimated to add around £50 a year to a typical dual-fuel customer’s bill. If total debt reaches £7 billion, this could increase bills by a further £10 to £15.
Around 75% of unpaid energy bills are currently in arrears, with no repayment plan in place for the majority of it.
Energy UK is calling for measures to reduce debt including targeted support for vulnerable households, greater use of smart pay-as-you-go meters and progress on Ofgem’s delayed debt relief scheme.
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