UK Energy Debt Relief Scheme Delayed Amid Soaring Consumer Arrears
Delay in Launching the Energy Debt Relief Scheme
By Susanna Twidale
LONDON, May 11 (Reuters) - A government scheme to clear 500 million pounds of energy debt for some of Britain's poorest households has yet to launch, as industry warns total arrears could reach 7 billion pounds ($9.5 billion) by year-end.
The delay comes as ministers face mounting pressure over the cost of living, with energy bills expected to rise in July.
Background and Announcement of the Scheme
Energy watchdog Ofgem announced the Debt Relief Scheme last October and had hoped it would be launched in early 2026.
Legislative and Data-Sharing Challenges
But before it can take effect, parliament must pass legislation allowing energy suppliers and government departments to share data identifying which benefit-receiving households would be eligible for help - a process that could take months.
The government is still at an earlier stage, consulting on whether to expand those data-sharing powers in the first place.
Government Response and Next Steps
"We are carefully considering responses to our consultation on expanding data sharing powers, which would allow for the delivery of an energy debt relief scheme, and will set out our next steps in due course," a government spokesperson said via email, adding that ministers were determined to tackle the energy debt crisis and support households.
Industry and Regulator Perspectives
Ofgem, which says it is ready to launch the scheme as soon as approvals are granted, has put the onus on ministers to move.
"We're working hard to get this right with government but ultimately this goes beyond Ofgem. Ministers need to weigh up the costs and benefits," an Ofgem spokesperson said via email.
Rising Consumer Debt and Industry Warnings
Industry group Energy UK estimates consumer debts at around 5.5 billion pounds and said this is likely to reach 7 billion pounds by the end of the year if no action is taken.
"Without proper regulatory measures to help those already in debt, and stop others from falling into it, this crisis will only grow further," Ned Hammond, Deputy Director, Policy (Customers) at Energy UK, said in an email.
Exchange Rate Information
($1 = 0.7357 pounds)
(Reporting by Susanna Twidale, Editing by Louise Heavens)
