UK Household Energy Debt May Reach £7bn by Year-End

Domestic energy debt in Great Britain reached a record £6bn by the end of June, and Energy UK warns the figure may climb to £7bn by the end of 2026. This surge is driven by gas market price volatility linked to conflicts in the Middle East.

The energy regulator Ofgem is expected to confirm a 4% increase in the energy price cap starting in October. This hike will likely offset a government commitment to reduce VAT on electricity bills. According to Cornwall Insight, the typical household will face an annual equivalent bill of £1,729 during the final quarter of the year.

Energy UK Chief Executive Dhara Vyas has urged the government to implement a permanent social discount tariff to combat fuel poverty. Vyas argues that current emergency measures are insufficient and that a social discount would provide targeted support to households based on varying needs.