What it means for youHousehold bills
Energy debt: what the new plan to write off some crisis-era arrears means for you
The government and Ofgem plan a one-off scheme to clear some energy debt from 2022 to 2024 for people who cannot pay. It is aimed at spring 2027.
Published 30 October 2026Last checked 30 October 2026England, Scotland, WalesFrom Department for Energy Security and Net Zero and Ofgem
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What's happening
The government and Ofgem have published a plan to tackle the £5 billion that households in Great Britain owe their energy suppliers. The main part is a one-off Debt Relief Scheme that could write off some debt built up during the 2022 to 2024 energy crisis for people in real financial difficulty. It is not open yet. Ofgem plans to consult again in late 2026 and aims to start it in spring 2027.
The question: What is the energy debt circuit breaker strategy, who could get debt written off, and when?
The policy
- Announced by
- Department for Energy Security and Net Zero and Ofgem
- Announced on
- 2026-10-28
- Stage
- announced
- Takes effect
- Debt Relief Scheme aimed at spring 2027, after a consultation in late 2026. Other parts follow in 2027 or need new laws
- Single parent on Universal Credit in England, £1,200 behind on gas and electricity since 2023: Falls into a group the scheme is being extended to. Could have some crisis-era debt written off from spring 2027, if they work with the supplier on a plan.
- Tenant renting a flat in Scotland: Ofgem is consulting on new guidance for when people move home, and the government plans a law requiring landlords to tell suppliers when tenants move in or out. Nothing changes yet.
- Working couple who pay by Direct Debit and owe nothing: No direct change. The government estimates the whole package could save a typical household about £130 over ten years by cutting the cost of debt added to everyone's bills.
This applies to you if…
- You owe money to your gas or electricity supplier, and some of it built up between 2022 and 2024
- You are in real financial difficulty and have little chance of paying it off
- You get a means-tested benefit or a disability benefit, or you are a pensioner (groups the plan says it will add to the scheme)
- You live in England, Scotland or Wales
Not for you if…
- People in Northern Ireland. The strategy applies to Great Britain only
- People whose energy account is up to date
- People with debt that built up only after the energy crisis, under the current proposals
What it's worth
Ofgem press release, 29 October 2026. The scheme targets about £2.47 billion of debt and arrears from 2022 to 2024 across Great Britain
How to do it
- 1
Check what you owe and since when
Look at your latest bill or your supplier's app. Note how much of the debt dates from 2022 to 2024.
Takes about 10 minutes
- 2
Talk to your supplier about a repayment plan you can afford
The plan says people who get help will be expected to work with their supplier on a repayment plan they can afford. Agreeing one now can also help stop the debt growing.
Takes about 20 minutes
- 3
Get free debt advice if things feel out of control
Citizens Advice, StepChange, National Debtline and MoneyHelper give free, confidential help and can speak to your supplier for you.
Takes about 30 minutes
- 4
Watch for Ofgem's consultation
Ofgem plans to consult on the revised scheme in late 2026. Details of who qualifies and how you get help should follow.
Deadline
No deadline yet
The Debt Relief Scheme is aimed at spring 2027, subject to the outcome of Ofgem's consultation.
The catches
It is a plan, not a scheme you can join today
The strategy sets out proposals. Several parts still need consultation, and some need new laws.
You will be expected to engage
Ofgem says people who get relief will be expected to work with their supplier, or a debt adviser, and agree a repayment plan they can realistically afford.
Who qualifies is not final
The debt size, the exact dates and how you get the help (automatic or by applying) have not been published.
Watch out for scams
Be wary of anyone who offers to get your energy debt written off for a fee. Do not pay anyone to get you onto the scheme, and use your supplier's usual contact details.
Illustrative example
Example: Dev, a pensioner in Wales with old arrears
Dev owes his electricity supplier £900. Most of it built up in the winter of 2022 to 2023, when prices were highest. He lives on his State Pension and Pension Credit.
- Dev calls his supplier and agrees a small weekly repayment he can manage.
- He contacts Citizens Advice, who check he is getting all the help he is entitled to.
- When the Debt Relief Scheme opens, Dev could be considered because he is a pensioner on a means-tested benefit with crisis-era debt.
Some of Dev's £900 could be written off, but the amount is not known yet.
Illustrative example. The scheme's final rules and amounts have not been published.
What this means for…
- Borrowing or in debt: If some of your energy debt dates from 2022 to 2024, you could be considered for the Debt Relief Scheme from spring 2027.
- Get benefits: The plan extends the scheme to people on means-tested and disability benefits.
- State Pension age or over: Pensioners are named as a group the scheme will be extended to.
- Renting: A future law would require landlords to tell suppliers when tenants move in or out. No date has been set.
Common misreadings
You might hear: All energy debt is being wiped.
Actually: The proposed scheme is one-off and targeted. It covers debt from the 2022 to 2024 energy crisis, for people in real financial need who have little chance of repaying.
You might hear: If I stop paying now, it will be written off.
Actually: The plan expects people who get help to engage with their supplier. Building up new debt could leave you worse off and is unlikely to be covered.
You might hear: Standard credit is being scrapped.
Actually: Ofgem is only exploring whether paying on receipt of a bill should stay the default. It plans to ask for evidence in 2027. Nothing has changed yet.
Where the UK nations differ
- England, Scotland and Wales
- The strategy applies here.
- Northern Ireland
- Not covered by this strategy. Energy in Northern Ireland has its own rules.
What you could do
owe money to your energy supplier
Contact your supplier and ask for a repayment plan you can afford.
are struggling with several debts
Get free debt advice from MoneyHelper, Citizens Advice, StepChange or National Debtline.
Timeline
28 October 2026
Strategy published
DESNZ and Ofgem publish the energy debt strategy alongside the Budget.
1 December 2026
Consultation on the Debt Relief Scheme (expected late 2026)
Ofgem says it will consult on the revised proposals. Ofgem also plans to consult on prepayment meter rules in the first three months of 2027.
1 March 2027
Debt Relief Scheme aimed to start (spring 2027)
Subject to the outcome of the consultation. No exact date given.
The detail
The rules
- Energy debt and arrears in Great Britain reached about £5 billion in the second quarter of 2026 (£5.02 billion in the strategy).
- More than 2 million households are in energy debt or arrears, and fewer than half have a repayment arrangement.
- Managing energy debt costs consumers about £67 a year through bills, almost double the level before 2022.
- Moving home is estimated to drive 20% to 40% of the current energy debt.
- Ofgem is reviewing the rules on fitting prepayment meters without consent, and plans to consult in the first quarter of 2027.
- Ofgem plans a call for evidence in 2027 on the role of standard credit.
References
- Ofgem press release, 29 October 2026: Debt Relief Scheme aims, eligibility groups, up to 2.4 million customers, £2.47 billion of 2022 to 2024 debt, spring 2027 launch
- Strategy, page 14: £5.02 billion of debt, more than 2 million households, £67 a year
- Strategy, pages 7 to 8: About £130 saving for a typical household over 10 years
Documents
- Energy debt circuit breaker: a strategy for domestic energy debt — Full strategy, DESNZ and Ofgem
- Ofgem press release
Words explained
- Arrears
- Money you owe for energy you have already used.
- Debt Relief Scheme
- Ofgem's planned one-off scheme to write off some energy debt from 2022 to 2024 for people who cannot pay it.
- Standard credit
- Paying for energy when the bill arrives, by cash, cheque or card, rather than by Direct Debit.
- Involuntary prepayment meter
- A prepayment meter fitted, or a smart meter switched to prepayment, without the customer's agreement, usually because of debt.
In short
The government and Ofgem plan a one-off scheme to write off some energy debt built up in 2022 to 2024 for people who cannot pay. It is not open yet and is aimed at spring 2027. If you are behind now, talk to your supplier about a plan you can afford and get free debt advice.
Related dates
- 25 Nov Ofgem announces the January to March 2027 price capAnnouncement · in 26 days
- 1 Jan New energy price cap takes effectChange · in 63 days
- 1 Jan £100 Household Energy Payment beginsChange · in 63 days
- 23 Feb Ofgem announces the April to June 2027 price capAnnouncement · in 116 days
- 26 Feb Warm Home Discount helpline deadlineDeadline · in 119 days
- 1 Apr Car tax (VED) rises for 2027 to 2028Change · in 153 days
Sources
- Energy debt circuit breaker: a strategy for domestic energy debt, DESNZ and Ofgem (2026-10-28)
- Strategy document (PDF), DESNZ and Ofgem (2026-10-28)
- New circuit breaker strategy launched to help households get out of energy debt, Ofgem (2026-10-29)
- Dealing with debt, MoneyHelper
- Get help paying your energy bills, Citizens Advice
This is guidance, not regulated financial advice. Check figures against the linked official source before you act. Written with AI assistance and checked against primary sources. How Kitty works. For free, impartial help, try MoneyHelper or Citizens Advice.