It’s time to wipe out our energy debt

Companies should start to play fair and pass on reductions to customers

Simon Read
Wednesday 03 June 2015 09:34
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New Energy Secretary, Amber Rudd, wrote to the Big Six suppliers to ask whether prices are reflecting companies’ costs
New Energy Secretary, Amber Rudd, wrote to the Big Six suppliers to ask whether prices are reflecting companies’ costs

Energy firms were thrust back into the spotlight this week after the new Energy Secretary, Amber Rudd, wrote to the Big Six suppliers to ask whether prices are reflecting companies’ costs. In other words, isn’t it time for a price cut.

In recent weeks I’ve warned readers that some firms are increasing direct debits to take account of winter underpayments, just at a time when heating costs should be falling as we all turn our boilers off. If you haven’t already checked, do so, and if your direct debit has risen, arrange to have it reduced to a reasonable level.

But not to too low a level or you could end up owing your supplier money, as millions already do. New figures published today reveal that almost four million UK homes are now in debt to their energy supplier – some 260,000 more than last year.

It means we now collectively owe energy providers £507m – up 9 per cent from £464m a year ago, according to the figures produced by uSwitch. The average debt per household has climbed by £2 to £130, but it’s alarming that it’s still going in the wrong direction. It makes it even more pressing that energy companies should start to play fair and pass on price reductions to customers.

Ann Robinson, director of consumer policy at uSwitch, warns: "Pre-payment meters were forcibly installed in almost 100,000 homes last year due to debt, yet our figures suggest this could be just the tip of the iceberg. This is evidence that energy has become totally unaffordable for millions of homes. People are still under relentless pressure just to cover the cost of essential bills."

This is the crux of the matter. Heating and lighting our homes is not a choice, but an essential. The fact that so many people were forced to choose to leave the heating off during the last winter because they couldn’t afford to pay the bills is nothing short of a national scandal.

The Government and energy firms must redouble their efforts to ensure that those who are struggling get the financial help they need, not more debt worries.

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