Insights: Debt Strategy – Reset and Reform for Customers in Debt

Summary
This report outlines the urgent need for a strategic overhaul in managing consumer energy debt, exacerbated by the global energy crisis. It details the approach to debt reset and reform to provide sustainable solutions for consumers and energy suppliers. The document, issued by Ofgem, seeks stakeholder feedback on proposed interventions including a potential debt relief scheme and new standards for supplier practices.
Key Take Aways

Energy Debt Surge: Energy debt has increased by 91% in the last two years, with a record high of £3.82 billion in arrears.
Consumer Vulnerability: Vulnerable consumers are at high risk of rationing or self-disconnection due to financial pressures.
Debt Burden Distribution: 75% of energy debt resides with consumers not on repayment plans.
Debt Relief Proposal: Ofgem is consulting on a debt relief scheme ranging from £0.5 to £1 billion to alleviate debt accumulated during the crisis.
Debt Standards Reform: New debt standards propose a 'debt guarantee...