New Consumer Energy Debt Advice service announced

A new service to help people with energy debt is to be led by Citizens Advice, working with the Money Advice Trust and StepChange. The Consumer Energy Debt Advice service will support clients to resolve their energy debt problems, according to a University of Bristol report published in October 2025¹.

The report, from the university's Personal Finance Research Centre, sets out an evidence-based action plan for improving referral routes from energy suppliers into free debt advice. It draws on three years of StepChange client data covering 2022 to 2024, a survey and interviews with StepChange clients who have energy debt, and four workshops with representatives from the energy sector, debt advice sector and consumer organisations¹.

StepChange, founded in 1993, said 170,928 clients completed a full debt advice session in 2024, with a "cost of living increase" the most common reason for debt, cited by 21% of new clients¹. The charity recorded around 170,000 clients with energy arrears between 2022 and 2024, of whom 22,500 said they were referred to StepChange by their energy supplier¹. In June 2025, three in ten (29%) of its clients reported a negative budget¹.

Among survey respondents with energy debt, 43% said their supplier had suggested they seek help with their finances or given them information about independent debt advice, and 40% of those referred by their supplier had not previously heard of StepChange, rising to 44% among those in financial difficulty for the first time¹. The majority (91%) were already behind with their energy bills when they sought debt advice, 75% had arrears on other household bills and 75% owed money on consumer credit debts¹. Four in ten (43%) said their energy debt was the most important debt to resolve, while 39% ranked their debts as equally important¹. Half (48%) had received debt collection letters or emails from their supplier, 37% had received phone calls about money owed, and 36% felt unfairly treated in relation to energy bills¹.

The report notes that Ofgem put in place new and updated rules at the end of 2023 to make it easier for domestic customers to contact their supplier¹. It calls for greater collaboration between suppliers and advice providers, adding support to Ofgem's proposals in its Debt Strategy¹.

The report sets out six longer-term ambitions and eight "quick wins". Among the quick wins are that suppliers deal with all not-for-profit, free FCA-registered debt advice providers; that frontline staff receive training on best practice referrals; that suppliers accept payment offers from customers who have sought advice; that suppliers offer flexibility in the length of debt payment plans and in how and when bills are paid; and that suppliers pause collection activity while a customer is seeking debt advice and acting on it¹. Longer-term ambitions include greater coordination between the energy and debt advice sectors, more supportive debt collection communications, adoption of the Standard Financial Statement, a HM Treasury review of the statutory Breathing Space scheme, and secure "passporting" of consumer data between suppliers and advice services¹.

Why it matters for households

The service is aimed at people who owe money to their energy supplier and who may also be behind on other bills. The report's figures suggest that most people reaching debt advice with energy arrears are already in arrears elsewhere: 75% had other household bill arrears and 75% owed money on consumer credit¹. Over half (55%) of StepChange's new clients have a vulnerable characteristic in addition to their debt problem¹.

The report describes what it says is a gap between suppliers identifying customers in difficulty and those customers reaching advice. Of those referred by their supplier, 40% had not heard of StepChange beforehand¹. Since contacting StepChange, three in five (60%) of survey respondents had made at least some progress sorting out their energy debt, and the report lists reduced stress and greater financial confidence among the non-financial benefits of advice¹.

The report also points to the scale of the problem. The average annual bill under the price cap rose from £1,073 in summer 2020 to £1,755 between 1 October and 31 December 2025 for consumers paying by Direct Debit, a rise of nearly £700 in five years¹. A third of UK households (34%) in May 2025 described their energy bills as unaffordable, rising to 52% of households with the lowest incomes¹. The total value of domestic energy debt and arrears in the first quarter of 2025 topped £4 billion¹.

For households already in arrears, the report's proposals touch on practical points: how quickly collection activity stops while advice is sought, whether a supplier accepts a payment offer made through an advice provider, and how much flexibility there is over payment dates and methods¹. The Breathing Space scheme, which gives protection from creditor action, is among the areas the report says should be reviewed, including allowing resets when clients move between advice providers¹. People dealing with energy and water bill arrears can find free debt advice through not-for-profit services, and the report's recommendations cover how suppliers should work with those providers¹.

What happens next

The report was published in October 2025 and sets out its ambitions and quick wins as recommendations rather than commitments from suppliers or government¹. It says it adds support to Ofgem's proposals in its Debt Strategy, but no timetable for the new Consumer Energy Debt Advice service, and no start date, has been reported¹.