The British Gas Energy Trust has reported that the UK is in just under £3 billion of energy debt1. The figure was announced on BBC Radio 4's You and Yours programme, the Trust said in a post published on 10 January 20241. The Trust said energy prices have continued to rise, with Ofgem altering the energy price cap to help suppliers recover some of the mounting debt while trying to reduce costs for consumers1.
The Trust set out what the cap does. It is the maximum amount suppliers can charge households per unit of energy on a standard tariff, also known as a variable or default tariff, and it covers roughly 29 million households1. Ofgem is the regulatory body in charge of the cap, which is reviewed and set every three months1. From 1 January 2024 the cap rose roughly 5 per cent, which could cost the average household an additional £94 annually1.
"From 1 st January 2024, the price cap rose roughly 5%, which could cost the average household an additional £94 annually"
The Trust also described the support funds it operates, which it said can write off energy debts1. The Energy Support Fund can provide grants up to £2,000 for British Gas customers, and the Individuals and Families Fund can provide grants up to £2,000 for British Gas and non-British Gas customers1. The Trust said it funds 45 organisations across Britain, whose money and energy advice projects provide support through advocacy services, income maximisation and benefits checks, tariff switching exercises, budgeting plans, energy efficiency surveys and onward referrals to services such as housing and mental health support1. It also pointed to a checklist containing over 200 links to free support, including resources on benefits, energy bills, debt advice and support schemes1.
| Item | Detail |
|---|---|
| Reported UK energy debt | Just under £3 billion1 |
| Price cap change from 1 January 2024 | Rose roughly 5 per cent1 |
| Possible annual cost to average household | An additional £941 |
| Households covered by the cap | Roughly 29 million1 |
| Energy Support Fund (British Gas customers) | Grants up to £2,0001 |
| Individuals and Families Fund (British Gas and non-British Gas customers) | Grants up to £2,0001 |
Why it matters for households
Energy debt at this scale sits across the household sector rather than in one supplier's accounts, and the Trust links it to the level of the cap1. For a household, the practical link runs between what a unit of energy costs on a default or variable tariff and what is owed on the account. The cap covers roughly 29 million households and is reset every three months, so the amount charged per unit can change four times a year1. The Trust's account of the January rise puts the possible annual effect on an average household at £941. Debt on an account is separate from the unit rate, and the Trust describes grant funds that can write off energy debts, with awards up to £2,000 under two named funds1. The Trust's post carries a note that it has not been updated in a while and that some details may no longer be accurate1.
What happens next
The Trust said the cap is due to change again from 1 April 2024, with Ofgem to confirm the new details in February1. No further dates are given in the Trust's post1.
Sources1 cited
- UK energy debt at just under £3 billion - British Gas Energy Trust, britishgasenergytrust.org.uk