SCOTLAND’S ENERGY BILLS DEBT CRISIS

SCOTLAND’S ENERGY BILLS DEBT CRISIS EXPOSED 

Rural consumers bearing the brunt with some debts over £3,000 

Citizens Advice Scotland is today (Wednesday) publishing new data that shows the huge debts that people in Scotland owe to energy companies. 

In 2023/24, the average amount of energy-related debt that was brought to Scotland’s CAB network was around £2300. The figure is significantly higher in remote and rural areas, where the average was £3047.  

Over a third of all Scottish CAB clients who have multiple debts and incomes too low to meet essential living costs had some level of fuel debt as part of their arrears. Across the energy market as a whole (i.e. not just CAB clients) the average energy debt for consumers with no repayment plan in place was £1761. 

The shocking figures were presented by CAS this week to the energy regulator Ofgem, who had called for evidence on the issue of energy debt. The CAS submission includes a number of case study examples, which are appended below.  

Publishing the figures, CAS social justice spokesperson Matthew Lee said, 

“This data shows the shocking extent of the energy bills crisis in Scotland. And behind the statistics are real people who are struggling to put food on the table and stay in their homes and whose income simply isn’t high enough to pay their bills. So debts like this build up.  

“The figure for the average debt is bad enough but the amount for those in remote and rural communities is breathtaking. People in northern areas tend to need more energy because the climate is colder and in all rural areas the building stock tends to be older, so less energy efficient. But debts like these are just devastating, particularly if they go unpaid so they just grow and grow.  

“We’ve made a number of recommendations to Ofgem about tackling this issue. We recognise that the cost of wholesale energy is high, and that energy companies are making some efforts to help customers pay their bills, but these often vary and are not consistent. We’d like to see Ofgem being more robust in applying industry-wide good practice in this area, perhaps following the guidelines that the Financial Conduct Authority has adopted in its approach to dealing with people in arrears.  

“However, we believe the single biggest measure that could make the most striking difference would be the introduction of a social tariff, applied to the bills of all consumers on low incomes. This would make the significant, long-term change that’s so desperately needed and we urge the industry to adopt it now. 

“In the meantime anyone who is struggling with their energy bills, or any other matter can get free, confidential and impartial support from the CAB network. We don’t judge, we just help, and we’ll do all we can to reduce or help you manage your debts, however big they are.”   

CASE STUDIES 

NB These are anonymous and the clients are not available for interview. The cases however are all from the last few months and are typical of the sorts of cases that CABs see every day. 

• A West of Scotland CAB has been supporting a terminally ill client who struggled to manage their energy bills and therefore accrued arrears. The client stated that due to their terminal illness, they need to keep the heating on for longer periods of time to stay warm. However, with the rising costs of energy, they cannot afford the costs, adding further detriment to their deteriorating health. The client stated that due to issues with their mental health, they had difficulty reading their meter and submitting regular readings, resulting in a debt of over £2,600. Despite being on the priority services register, the client found supplier assistance limited: a one-time meter reading with only one attempt and a potential month-long wait, or quarterly readings with potentially inaccurate estimates. Furthermore, after consistent bill payments, the supplier claimed the amount stated on the pre-printed bill was not the actual amount owed. The client found the billing information complex and misleading, and especially difficult as they struggled with reading comprehension.    

• A North of Scotland CAB reports of pension-aged woman with osteoarthritis who stopped using her gas central heating and oven because of concerns about cost and anxiety about going into debt. The client uses a sandwich toaster to make meals and reported that her osteoarthritis had deteriorated due to living in the cold.   

• A North of Scotland CAB reports of a pension-aged couple whose energy bills increased to £170, which caused them to accrue arrears of £490. They stopped using their central heating, which exacerbated lung conditions that both clients have. They also started going to bed at 6:30pm to reduce electricity use.   

• The Extra Help Unit (a specialist service linked to CAS) reports of a client with a brain tumour who moved from a pay-as-you-go account to quarterly billing. He received two bills: one for £789 and another for approximately £1,100. The client was unable to pay both bills in full. He phoned his supplier to arrange an affordable repayment plan but was unable to secure an agreement with the customer service agent. Subsequently, the client began to receive debt collection action letters.