2 million Britons in energy debt

18 July 2007
There are 2 million Brits in debt to their energy suppliers, according to a recent report from Ofgem, which has promoted uSwitch to urge consumers to shop around to find a cheaper deal.

The average debt per customer is just under £200, which continues to rise, and more than 5,000 households are disconnected each year because they are unable to pay their energy bills.

Eight per cent of those owe an average of more than £600 but 64% owe less than £100, and could therefore benefit from switching to a new provider, which could save up to £210, says uSwitch.

Despite the fact that Pre Payment Meters (PPMs) cost the consumer, on average, £120 more than a standard supply, more than 333,000 were installed in 2006 in an attempt to combat Britain’s growing energy debt. It takes an average of 22 weeks longer to repay a PPM debt than a standard energy debt.

According to uSwitch, the amount of money owed by consumers to their energy provider is just the tip of the iceberg and the actual figures are considerably higher, because those in the Ofgem report only take into account customers that have official debt repayment plans.

Ann Robinson, Consumer Policy Director at uSwitch.com, says: “There is an alarming propensity for energy providers to push customers in debt onto prepayment meters – this is a cop-out as it is often their own poor billing and debt management practices that force consumers into debt in the first place.

“The key for all consumers is to ensure that they are paying the lowest possible prices for their energy,” she continued. “On average customers could save £210 by switching from their suppliers to the cheapest available dual fuel plan.”

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