The British Gas Energy Trust published its response to Ofgem's Resetting the Debt Relief Landscape consultation on 10 February 2025, saying it supports a debt relief scheme if it is part of a long-term solution to energy affordability and creates enduring benefits1. The Trust is a charity established in 2004 and solely funded by British Gas, which says it has invested nearly £200 million in tackling energy-related hardship and supported around 170,000 individuals in the last four years alone1.
The Trust's response draws on its own grant schemes. Over the 2023/24 financial year it supported over 64,000 clients, with more than £16.3 million allocated for debt write-off and financial assistance grants; a further £6.9 million of client debt was written off through holistic support programmes, while £25.8 million of client debt was successfully managed1. Since 2020 it has provided a total of £26,308,775 in debt write-off grants1. In 2023/24 it provided 5,383 debt write-off grants totalling £7.8 million, issued £2.4 million in Emergency Fuel Vouchers and assisted 25,367 households across England, Scotland and Wales1.
"The Trust is supportive of a debt relief scheme, if it is part of a long-term solution to energy affordability and creates enduring benefits"
The Trust states that debt and arrears are significant issues for the energy sector at £3.8bn, and that Ofgem estimates the proposed fund will clear between £500m and £1bn of energy debt, covering only a fraction of arrears1. It compares this with the Warm Home Discount scheme, which distributed £471 million in rebates to 3.14 million households in 2023/241. It warns that a poorly designed funding mechanism could increase bills for non-qualifying consumers1.
The Trust's own grant criteria set debt bands by payment type and fund1:
| Fund | Pre-payment meter customers | Credit customers |
|---|---|---|
| Individuals & Families Fund | £50 to £1,700 of energy debt | £250 to £1,700 of energy debt |
| Energy Support Fund | Minimum £50, maximum £2,000 gas and/or electricity debt | Minimum £250, maximum £2,000 gas and/or electricity debt |
Applicants must be in or facing fuel poverty1. The average grant was £530 under the Individuals & Families Fund and £960 under the Energy Support Fund1. Among 2023/24 recipients, average household income was £18,000 to £20,400, placing them in the poorest 15% of UK households; 97% were in fuel poverty and 56% received Universal Credit, four times the national average1.
The Trust says a one-size-fits-all scheme may leave recipients in financial distress if partial write-off does not enable sustainable repayment, and proposes a tiered approach in which the most vulnerable households receive 100% debt clearance and households with higher incomes receive partial relief1. It also raises the possibility of a debt matching model, under which a percentage of debt is cleared and the remainder is conditional on regular payments over a 6 to 12 month period1. It argues that determining eligibility solely through means-tested benefits is inadequate, and that assessment should factor in total household income, vulnerability factors, the level and duration of energy debt, and the ability to pay ongoing costs after intervention1.
Why it matters for households
Energy debt is the point at which a household's arrears start to affect what it can afford to keep running at home. The Trust's figures show who typically reaches that point: households on incomes of £18,000 to £20,400, almost all in fuel poverty, with more than half on Universal Credit and 56% using prepayment meters1. For a household carrying arrears, a scheme that clears the balance outright restores the ability to pay for future consumption without a standing deduction from a meter or a repayment added to a bill. The Trust's evidence is that clearing debt alone is less durable than clearing it alongside advice: among grant recipients who also received money advice, 81% were not in debt three months later and 84% at six months, against 61% and 53% for those who received a write-off without money advice1. Its social return analysis found £5.50 of social value per £1 spent overall, and £6.50 per £1 for money and energy advice grants, against £2.60 to £2.30 per £1 for direct fuel debt clearance grants1. The size of any scheme relative to the £3.8bn of market debt is the central question for how many homes it reaches1.
What happens next
The Trust describes Ofgem's proposals as at an early stage and says it would be pleased to engage further1. It states that Miatta Fahnbulleh MP, Minister for Energy Consumers, recently confirmed that social tariff proposals are under government review, and that the Scottish Government's Social Tariff Working Group will report findings to the UK Government by March 20241. No date has been reported for Ofgem's decision on the consultation.
Sources1 cited
- The Trust's response to the resetting the debt relief landscape consultation - British Gas Energy Trust, britishgasenergytrust.org.uk