Outrage as Ofgem allows fuel suppliers to charge more to pay off bad debts

15 December 2023 , 17:44

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Outrageous: Cost cap to rise (Image: PA)

Campaigners have slammed energy regulator Ofgem for allowing suppliers to shift the cost of recouping bad debts onto customers.

Ofgem is proposing to add £16 to its price cap for households from next April. The one-off charge is meant to cover the cost of those customers who have fallen behind with their payments. It is estimated that suppliers are owed a record £2.9billion.

Tim Jarvis, director general for markets at Ofgem, said: “We know that cost of living pressure is hitting people hard and this is evident in the increase in energy debt reaching record levels.

“We have taken steps to ensure energy firms are taking better care of customers and treating people struggling with debt fairly, through our robust consumer standards, and that companies are getting in touch to offer support, such as affordable payment plans, where needed.

“However, the record level of debt in the system means we must take action to make sure suppliers can recover their reasonable costs, so the market remains resilient, and suppliers are offering consumers support in managing their debts.“

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But Simon Francis, coordinator of the End Fuel Poverty Coalition, said: “This outrageous tax on energy consumers is simply not fair. Energy suppliers have posted billions in profits already this year while millions of people struggle in cold damp homes.

“The record levels of energy debt are due to Britain’s broken energy system.”

Graham Hiscott