Ofgem has said it will launch a consultation later this year on proposals to trial new processes during home moves, under which customers would be required to contact their supplier to set up an account early in the process1. The regulator set out the plan in a debt strategy update published on 6 November 2025, which also confirmed detailed proposals for its Debt Relief Scheme (DRS)1.
The home-move process, described by Ofgem as the "change of tenancy" process, has been identified through evidence received over the year as a key target area to reduce debt build-up1. In Great Britain, it is generally accepted that consumers can use energy straight away on moving into a new property, which Ofgem says can create a tendency towards debt where a customer has access to energy for a prolonged period without ever setting up an account1. Evidence from suppliers suggests this group may be responsible for between 20% and 40% of the overall debt figure1. The trials would focus on proposals to switch existing smart meters into prepayment mode where domestic customers move homes1. Ofgem said it will consider existing prepayment meter rules and seek to ensure appropriate safeguards are in place1.
"Later this year, we will launch a consultation with proposals to trial new processes during home moves, that will require customers to contact their supplier to set up an account early in the process"
The update gives the scale of the debt problem. By June 2025, domestic consumer energy debt had reached £4.43 billion, an increase of 20% from the same time in 2024 and 71% since 20231. Nearly three quarters of that debt is with customers who have no repayment plan in place, known as arrears1. Ofgem said the number of households in debt has not risen dramatically over the same period, suggesting a significant part of the challenge is with a proportion of consumers going deeper into debt1.
On the cost to other billpayers, Ofgem said a typical consumer pays around £52 per year towards the cost of managing and writing off energy debt, based on an average household on a standard variable tariff paying by direct debit, and that this may be higher for some households depending on how they pay1. Around 16% of customers pay by standard credit, and research suggests up to 43% do not realise this is the most expensive way to pay, with a £135 price premium specifically due to the costs of debt1.
| Measure | Figure |
|---|---|
| Domestic consumer energy debt, June 2025 | £4.43 billion |
| Rise on same time in 2024 | 20% |
| Rise since 2023 | 71% |
| Share of debt in arrears (no repayment plan) | Nearly three quarters |
| Typical annual cost to a consumer of managing and writing off debt | Around £52 |
| Share of customers paying by standard credit | Around 16% |
| Standard credit price premium due to debt costs | £135 |
Why it matters for households
For a household moving home, the practical effect of the proposals would be that setting up an energy account becomes an early step in the move rather than something that can wait. Ofgem's stated concern is that a gap between moving in and registering leaves a customer using energy without an account, and that debt can accumulate over weeks or months before it surfaces1. For a household's energy independence, the point at which a supplier knows who is responsible for a meter, and from when, determines who carries the liability for that period.
The wider figures bear on households that are not in debt themselves. Debt that suppliers cannot recover is partly spread across all billpayers, and Ofgem's stated aim is to drive down the £52 annual figure1. The regulator also said it intends to consider further reforms to Additional Support Credit as part of a wider review of access to credit, and that this review will need to explore the role and use of standard credit as a payment method1. It said it is already exploring ways to support and encourage more customers onto more efficient forms of payment1.
What happens next
The consultation on trialling new home-move processes is due later this year1. Ofgem has published detailed proposals for phase 1 of the DRS in a statutory consultation, and expects that phase to support up to 200,000 consumers in receipt of means-tested benefits and reduce the debt stock by up to £500 million1. Phase 2 would cover other households in payment difficulty who are not in receipt of benefits, where a robust approach to affordability assessment can be put in place1. Ofgem said it welcomes the government's recent expansion of the Warm Home Discount and its proposals to continue the scheme once the current scheme ends in March 20261. It said it will provide further thinking on the timings of its access to credit review as its strategy evolves1.