Money Wellness
A man trying to warm up near a radiator while looking at his energy bill
category iconbills
category iconcost of living
calendar icon13 Oct 2023

Ofgem considering increasing bills to help energy suppliers

The UK’s energy regulator is considering increasing bills to help suppliers with rising levels of household debt.

Figures from Ofgem show energy debt has reached a record £2.6bn. This is due to soaring bills and other cost-of-living pressures on households.

Despite this, energy companies made more than £2bn in profits in the first half of 2023 alone.

A small price to pay

Ofgem is looking into a one-off increase to customers’ bills of up to £17 a year.

It suggests this might be a small price to pay when weighed against the risk of customers facing higher costs and poorer standards of service if suppliers go bust.

The regulator pointed out, when about 30 suppliers went bust previously, customers were charged an extra £82 to cover the costs of ensuring households were not cut off.

Tim Jarvis from Ofgem said:

“We know that households across the country are struggling with wider cost-of-living challengers, including energy, so any decision to add costs to the price cap is not one we take lightly.”

Profiting from misery

But End Fuel Poverty are calling for a help-to-repay repayment-matching scheme to provide a safe route out of debt for struggling households:

“All this time, energy firms have continued to profit from the misery of people racking up debt and living in cold damp homes.

“Rather than pass on more increases to energy bills, the government needs to work with energy firms to introduce a ‘help to repay’ scheme to get Britain’s households back onto an even keel.”

 

Avatar of Rebecca Routledge

Rebecca Routledge

A qualified journalist for over 15 years with a background in financial services. Rebecca is Money Wellness’s consumer champion, helping you improve your financial wellbeing by providing information on everything from income maximisation to budgeting and saving tips.

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