In a hard-hitting response to an Ofgem consultation on the issue, CAS is today calling for a new energy debt relief scheme, which would aim to support households who are unable to make their energy costs. 

Calling the problem ‘unsustainable and unjust,’ the charity points out that: 

• In 2023/24 - the latest year for which data is available - the average energy debt that people bring to their local Citizens Advice Bureau (CAB) was £2,500. Worryingly, this figure is 8% higher than the previous year.  
• The average energy debt per person stands at £3,130 in rural areas in Scotland, which is 30% higher than the average energy debt overall. 
• Energy debt causes significant physical and mental health harm to people. Including people like Helen (not her real name). Helen retired early to care for her terminally ill husband, who subsequently passed away. This put her under serious financial strain and Helen accrued energy arrears of almost £2,700, which had a significant negative impact on her mental health.   
   CAS director of impact, David Hilferty, said: “The case for an energy debt relief scheme is inarguable. Only bold, targeted and urgent action will begin to undo the harm that far too many are facing.  

“Historically high energy prices have forced people into energy debt and arrears. Evidence gathered by the Citizens Advice network in Scotland shows that energy debt imposes high levels of physical, mental and emotional harm on people. It leaves people feeling anxious about their financial future and worried about using gas or electricity for everyday essentials like heating homes, cooking or bathing.  

“The insights our network has gathered shows that energy debt creates added stress for people who are struggling with low incomes, ill health and other vulnerable situations; this is unsustainable and unjust. 

“This situation is well beyond the point of tinkering at the edges. We urgently need a robust and compassionate scheme of debt relief, otherwise huge numbers of people in Scotland are going to be forced to endure further harm.” 

CAS’ proposed solution in detail: 

• Ofgem should introduce a debt relief scheme urgently.  
• Ofgem should engage the UK Government to obtain funding for an enduring debt relief scheme that supports people in energy debt after Ofgem’s proposed measures end.
• Ofgem should explore establishing a pre-approved level of support that allows organisations to build capacity before delivering the scheme.  
• The scheme should include debt-matching and debt write-offs.  
• We do not support Ofgem’s suggestion that only debt and arrears accrued between 1 April 2022 and 31 March 2024 should be eligible for relief.  
• Setting a minimum level of indebtedness risks excluding people who need debt relief.  
• Ofgem should use multiple affordability proxies. Using only Warm Home Discount presents particular problems in Scotland.  
• Access to the scheme should not be conditional on making previous payments.