Many households are struggling to keep up with their energy bills as prices are set to rise in July, according to recent data from Money Wellness. The amount owed to energy suppliers has surged by 23% over the past three years, with arrears increasing from an average of £1,848 in 2023/24 to £2,270 presently. The number of individuals seeking debt advice who are in arrears with their energy bills has risen from one in three to nearly half during the same period.

Regulator Ofgem is gearing up to announce an increase in the price cap for thousands of households from July 1. Industry analysts predict that Ofgem’s cap could rise by over £200 annually, climbing from the current £1,641 to £1,850.

Despite a decrease in energy prices, many households have not yet recovered from previous financial strains. A substantial number are still repaying debts accumulated during the pandemic and subsequent economic challenges, leaving little room in their budgets even as headline prices stabilize.

Money Wellness is advocating for the implementation of a national social tariff for energy, similar to existing water support schemes, citing the fragmented and challenging nature of current assistance programs. Their analysis suggests that up to 87% of customers in energy arrears could qualify for a social tariff based on criteria such as means-tested benefits, disability benefits, evidence of debt problems, or high essential energy usage.

The impending energy price cap increase is expected to prompt renewed calls for targeted governmental aid. Suggestions include the establishment of a publicly owned energy retailer to offer affordable options for households and a reevaluation of private ownership in the energy sector. Redirecting profits currently going to shareholders into reducing bills could potentially alleviate the financial burden on consumers and combat fuel poverty.