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Daily Mirror
Daily Mirror
Business
Graham Hiscott

Over 3million households in winter energy debt nightmare - 500,000 more than a year ago

More than three million households are going into winter in debt to their energy supplier - 500,000 more than a year ago, research suggests.

In total, households owe energy suppliers £510million, a rise of £77million on 2020, according to calculations by price comparison website Uswitch.com.

The sharp rise comes as millions of customers are reeling from a surge in energy prices after regulators hiked a price cap.

Experts say customers should have built up a credit on their energy account after the summer months if they pay by monthly direct debit.

Doing so can prevent having a sharp increase in bills over winter, when households use most of our annual energy use.

Have you been hit by the price hikes? Have your say in the comment section

However, the number of customers in credit has fallen by 4% compared to last year, a survey by Uswitch suggests.

Of those in the red with their supplier, three fifths said their debt is higher or the same as it was last year, while only one in eight said the amount they owe is lower.

The average amount owed is £153.

Nearly six in 10 of those questioned said they were either worried, or very worried, about how they are going to pay for their energy bills this winter.

Almost a fifth - 17% - claimed they would avoid putting the heating on even when it was cold, and more than two million will spend less on food.

Justina Miltienyte, energy policy expert at Uswitch.com, said: “No customer should have to choose between heating or eating and it’s alarming that many households are facing that decision this winter.

“Anyone who is worried about their energy bills, or their existing debt, should contact their energy supplier in the first instance to see if they can set up an affordable repayment plan.”

Cost surges kill suppliers

A record number of energy suppliers have gone bust this year - handing power to the industry’s big firms, research has revealed.

A surge in wholesale energy costs has killed more than half the suppliers which were operating at the start of the year, according to consultants Cornwall Insight.

In January there were 47 domestic suppliers - five large, 12 medium and 30 small.

Today, that has fallen to only 25 suppliers.

Most customers of those firms which have gone bust have been moved to larger suppliers, growing their market share from 68.5% at the start of the year to 70.1% now.

Anna Moss, head of consumer markets at Cornwall Insight, said: “The very high wholesale prices have caused significant distress even before winter begins.”

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