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Fuel arrears

Missed energy payments are classed as a ‘priority debt’. This means that they should be paid before ‘non-priority’ debts such as credit card debts.  This is because the law gives your energy supplier the power to cut off your gas or electricity if you don’t pay.

Ofgem have put rules in place to make sure suppliers can’t back-bill you beyond the previous 12 months. There are also a number of discounts that you may be entitled to.

Speak to your energy supplier directly to discuss your fuel arrears:

Step 1)

Make a list of your incoming and outgoing money per month to see where your energy bill fits in. You need to work out a realistic figure of how much you can pay back per month. Be realistic, don’t over-promise on what you can pay back. It’s better you can meet the smaller payments than miss larger ones.

If you want help with this look online at Citizens Advice, National Debtline and Money Advice Service. You can also receive help with this from our qualified energy advisers as part of a LEAP visit.

Step 2)

Be honest and tell your energy supplier your situation. The following options might be offered to help you:

  • Your supplier might ask for meter readings and make sure you’re on an appropriate tariff. They can also help identify reasons why you are using so much energy and help to bring this down.
  • Your supplier might suggest a repayment plan for your debts. They might suggest for you to move onto prepayment meter if you are struggling to make the repayments. This is a pay-as-you-go method and it can be arranged to pay back your debts too. Prepayment meters can be set up to take debt repayments over a certain amount of time regardless of energy usage.

If you receive benefits you may also be able to set your fuel debt to come directly off your benefit payment. This is called ‘fuel direct’; check here to find out more.

In a worst case scenario energy suppliers by law can cut off your supply if you don’t arrange to pay your debt. This is not a good situation for you or your supplier so it’s in everyone’s best interest that you can repay and get the issue resolved.

Prepayment meters:

With a prepayment meter  you pay for your gas and electricity before use. There is also a standing charge applied to the meter each day regardless of fuel use. You will have to go to certain shops to top it up – look out for the PayPoint sign to find participating shops or the PayPoint postcode finder on the PayPoint website.

 

Things to remember:
  • You need to keep your prepayment meter topped up with credit or your gas and electricity supply can be cut off.
  • This means you have to keep it topped up to cover standing charges too.
  • There are certain discounts available which you can’t receive on a prepayment meter.
  • Prepayment meters typically offer more expensive tariffs, which could mean you’ll pay more for your energy than those on a credit meter.
  • Dont forget to check if you are eligible with any help with your bills.

 

Switching energy supplier when you are in debt
  • If you’ve been in debt to your supplier for less than 28 days you can still switch. Any owed amounts will be added to your final bill from your old supplier.
  • If you’ve been in debt to your supplier for over 28 days, you’ll need to repay the debt first.
  • When it’s your supplier’s fault that you’re in debt, they can’t stop you from switching.

 

If you are wanting to switch and on a prepayment meter

As long as you owe less than £500 for gas and £500 for electricity, you can switch to a new supplier if you are paying off an energy debt through a prepayment meter.

You are entitled to do so through the ‘Debt Assignment Protocol’. This would mean your new supplier takes on the debt and you repay them instead, based on the new terms of your agreement with them.

Back to Discounts and managing your energy finances