Energy debt: government and Ofgem plan a one-off Debt Relief Scheme for spring 2027

What has happened

On 28 October 2026 the Department for Energy Security and Net Zero and Ofgem published Energy debt circuit breaker, a joint strategy for household energy debt. It says consumer energy debt in Great Britain has reached £5 billion and that more than 2 million households are in energy debt and arrears.

The main measure is the Debt Relief Scheme. It is a one-off scheme for people in genuine financial need who built up energy debt because of high prices during the 2022 to 2024 energy crisis and have little realistic prospect of repaying it. Compared with Ofgem's earlier plans, the scheme will now run in a single phase, and eligibility will be extended to people on means-tested benefits, people on disability benefits and pensioners. People will also have to meet stronger engagement conditions to get help, with more use of smart prepayment and supplier repayment plans, while protections stay in place for those who are vulnerable or in the greatest financial need.

Ofgem plans to consult on the final design in late 2026 and decide early in 2027, working towards the scheme opening to customers in spring 2027. The strategy says this depends on the outcome of the consultation.

The strategy includes other changes too. Ofgem has published a discussion paper on whether the rules on involuntary prepayment meter installations are working as intended, and plans to consult on any proposals in the first quarter of 2027. Ofgem is also consulting on guidance for suppliers when someone moves into a home without registering with a supplier. The government says it will bring in legislation requiring landlords to give suppliers accurate information when tenants move in or out.

What it means for you

If you are behind on your energy bills, nothing changes today. There is no scheme to apply for yet. The strategy does not say how much debt could be written off for each household, and the exact rules on who qualifies are still to be set in Ofgem's consultation.

Help will be linked to engagement. The strategy lists what it expects from energy customers: talking to their supplier or a debt advice charity when they have payment difficulties, giving accurate information about their circumstances, and agreeing affordable repayment arrangements where possible. Talking to your supplier now also opens up help that already exists, such as payment plans and hardship funds.

This is a plan for energy debt in Great Britain, not a set of rules in force. Each part still has to go through consultation or, for the landlord changes, new legislation.

Who it affects

Households in Great Britain with energy debt, especially people on means-tested or disability benefits and pensioners who built up debt during the 2022 to 2024 energy crisis.

What you can do

• If energy bills or other debts are a struggle, get free debt advice now from MoneyHelper, StepChange, National Debtline or Citizens Advice. You do not need to wait for the Debt Relief Scheme.
• Contact your energy supplier. Ofgem says you can ask them to agree a payment plan, payment break or reduction, review your payments and debt repayments, and give you access to hardship funds.
• Ask your supplier whether it runs its own schemes or grants to help with energy costs or with paying off energy debt.
• If you get means-tested benefits, check whether you can get the Warm Home Discount.
• If you are worried about creditors taking action, ask a debt adviser about Breathing Space in England and Wales, or a debt moratorium in Scotland. Ofgem explains that these give you temporary protection while you get advice.

Sources

Every fact in this page was checked against these official sources on 31 October 2026.

1. Energy debt circuit breaker: our joint strategy for domestic energy debt Department for Energy Security and Net Zero and Ofgem (GOV.UK)
2. Get help with your home or business energy bills Ofgem
3. Warm Home Discount Scheme GOV.UK

Written and fact-checked by the PiggyBank editorial team. Published 31 October 2026. This news is general information, not financial advice. How we write and check our guides.