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260,000 more in debt to energy firm

Published 03/06/2015

While there was a colder than normal start to the year, winter saw near average temperatures and was the sunniest since records began
While there was a colder than normal start to the year, winter saw near average temperatures and was the sunniest since records began

The number of households in debt to their energy company is estimated to have grown by 260,000 since last year despite recent cuts to tariffs, according to a study.

Almost four million UK householders collectively owe suppliers £507 million - up 9% from £464 million last year - with 30% admitting they owe their company more than they did a year ago, the survey for uSwitch found.

The average debt per household is £130, up from £128 last year, the poll suggests.

The higher debt come despite more than half (54%) of consumers rationing their energy use to keep bills down, an increase in disposable incomes and recent price cuts on standard tariffs, uSwitch noted.

While there was a colder than normal start to the year, winter saw near average temperatures and was the sunniest since records began.

This year's price cuts led to average reductions to standard dual fuel tariffs offered by the Big Six of 2.2%, or £28 a year, leaving the average annual bill at £1,237, according to previous uSwitch figures.

The findings follow Energy and Climate Change Secretary Amber Rudd writing to energy firms asking them to pass on a fall in wholesale costs to consumers.

The uSwitch poll found 30% of consumers are choosing to "turn a blind eye" to rising debt in the hope it will decrease over time, while just 19% said they were able to pay it off in one lump sum.

USwitch director of consumer policy Ann Robinson said: "This is evidence that energy has become totally unaffordable for millions of homes.

"Disposable incomes may be on the up, but people are still under relentless pressure just to cover the cost of essential bills.

"Not only are more households in the red to their energy supplier, but the amount they owe has gone up, despite the recent price cuts.

"Energy suppliers must urgently pass on double-digit reductions to their customers - many of whom have admitted to going cold this winter in an attempt to keep their bills down."

:: Opinium surveyed 2,002 UK energy bill-payers between May 1 and 5.

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