Energy UK published the Winter 2023 Voluntary Debt Commitment on 12 October 2023, developed with Citizens Advice and Ofgem. The commitment sets out actions that domestic energy suppliers will take, above their regulatory obligations, to support customers in payment difficulty1. It applies from October 2023 until March 20241.
The suppliers signed up are British Gas, E, Ecotricity, EDF Energy, E.ON Next, Good Energy, Octopus, Ovo, Rebel Energy, Shell Energy Retail Limited, Scottish Power, So Energy, Utilita and Utility Warehouse1. The measures cover five areas: fair treatment of customers in debt, financial assistance, help to achieve lower bills, accurate billing, and a national communications campaign1.
Energy UK set out the scale of the problem alongside the commitment. It said household energy costs remain almost double pre-crisis levels, and cited Citizens Advice estimates that UK households are behind on bills by £22 billion, with energy debts and council tax arrears now the most encountered debt types1. Citizens Advice data showed the number of people seeking support with energy bills rose by 112 per cent in the first four months of 2023 compared with the same period in 20201. Ofgem's most recent data put customer debt and arrears in energy at around £2.6 billion, double the level at the start of 20201.
"The Winter 2023 Voluntary Debt Commitment for domestic energy suppliers is a combination of good practice and crisis measures for the concerning position customers are in for winter 2023."
On financial assistance, Energy UK said the support offered is set out in detail on its website for each supplier and may include enhanced debt write-off schemes and hardship funds, enhanced funding to charity partners and frontline organisations, and reducing or waiving standing charges over winter for certain customers1. Under the Energy UK Vulnerability Commitment, which Energy UK says covers 95 per cent of the market, suppliers have appointed a Vulnerability Champion at board level or equivalent1. Energy UK also said suppliers representing 75 per cent of the energy market have signed up to the demand flexibility service, which pays customers for using less energy at peak times1.
On billing, the commitment covers improving the ease of giving meter readings, training service staff on accurate billing, and integrating smart meter data to help identify vulnerability1. Energy UK said customers on smart prepayment meters can receive additional support more quickly and effectively than those on legacy meters1.
The commitment sits alongside a separate industry campaign, Speak. Seek. Save., developed by Citizens Advice and Energy UK, with messaging supported by suppliers, Ofgem and the Government1. It encourages customers behind on bills to speak to their supplier, seek debt advice, and save energy through efficiency measures1.
Why it matters for households
The commitment is voluntary, so it does not create new enforceable rights for households. What it does is set out what the fourteen named suppliers have said they will do beyond their licence conditions, which matters for a household carrying energy debt through the winter. The measures most likely to be felt directly are repayment plans reflecting ability to pay, payment holidays where appropriate, and the possibility of reduced or waived standing charges for certain customers1.
The figures show why the commitment exists. Energy debt of around £2.6 billion is double the level at the start of 2020, and Energy UK states that as debt increases, a greater proportion will be unpaid1. For a household, that means the support available depends heavily on which supplier it is with, because each supplier determines how it meets the voluntary initiatives and how it targets funding1. Households with a supplier not on the list are not covered by the commitment as published.
The commitment also points to Citizens Advice and other advice bodies as the route to an affordable repayment plan, and states that energy bill debt is classed as a priority debt1. Emergency credit, additional support credit and friendly-hours credit remain available through meters and suppliers as before1.
What happens next
The commitment runs until March 20241. Energy UK has not reported what happens after that date. The Warm Home Discount, worth £150 off an energy bill or added to a meter, is paid out by suppliers over the winter months, and in Scotland customers still need to apply to their supplier, while in England and Wales they no longer do1.
Sources1 cited
- The Winter 2023 Voluntary Debt Commitment - Energy UK, energy-uk.org.uk