What to do if you are in debt to your energy supplier

Find out everything you need to know if you are in debt to your energy supplier. To switch your energy supplier enter your postcode in box below:

With the cost of energy on the rise, more and more people are becoming indebted to their energy provider.

We have put together a few pointers to help you avoid debt, as well as some for those who are already in arrears.

Choose a good deal initially

The best way to make sure you don’t get into debt is to have a good value tariff to begin with, if you want to see the best energy out there, check our handy comparison tool.

Get a pre-payment meter

These can be requested to make sure that you do not fall into debt in the first place, you load a certain amount of credit onto it and you can then use an equivalent amount of energy. The downside is that once it runs out so will your energy, and they are also more expensive than a normal tariff. They can also be issued by an energy company for households that are already in arrears to prevent them falling into more debt.

Contact you supplier

Once you have noticed that you are in arrears the first step you will want to take is to contact your energy provider. The sooner you do this the sooner you can explain your situation and put some sort plan in place to get it paid off.

Work out a plan

Most companies will offer you a plan based on what you can pay back, so it’s worth making a note of current outgoings and income so you and the energy provider can work out a plan that works. These plans can involve payments made weekly, fortnightly, or monthly and will be split between paying for the energy you are currently using and paying off your debt. The most important thing is agreeing to a plan with your energy company that you are going to be able to afford - if you default on your plan it will make any future negotiation much harder.

Talk to a professional

If you have exhausted all options and need help there are various groups that you can get in touch with that have been set up for this exact purpose. For example, you can contact the citizens advice bureau who are willing to negotiate with the energy companies on your behalf.

FAQ

Once you have noticed that you are in arrears the first step you will want to take is to contact your energy provider. The sooner you do this the sooner you can explain your situation and put some sort plan in place to get it paid off.

- Can I switch to a cheaper tariff?

Yes. One way to try and avoid debt in the future would be to switch to a cheaper tariff with your current company. Some companies will allow this, however in all cases you will need to owe less than £500 before they will let you switch.

- Can I switch energy provider if I am in debt?

You are always entitled to switch energy providers at any point through your contract. However, you can only do so if owe less than £500 to your current supplier, if this is the case then the debt gets transferred to the new company as per the ‘debt assignment protocol’. Some companies will make you pay exit fees for leaving early though, so if you’re already in debt this might be something you will want to consider.

- Can I get cut off?

This is highly unlikely and will only be used by the energy company as an absolute last resort. If you are indebted to them they will try and resolve the situation either with a pre-payment meter or a payment plan. The big six energy providers have all agreed to certain stipulations which means they cannot cut off a household if it has

  • Some with a disability
  • Someone with long term health problems
  • Severe financial problems
  • Young children

The only rules that all energy companies must follow is that you can’t cut off a household that has pensioners or children under 5 between the 1st of October and 31st of March (i.e. during colder winter months when heating is important).

- Will not paying my bills affect my credit rating?

This depends entirely on your particular situation but it is highly likely if you have defaulted on multiple payments that your energy provider will share your information with credit reference agencies.

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