EDF confirms it will take £75 from UK bank accounts | Personal Finance | Finance
EDF says £75 will be added to energy bills to cover struggling houesholds’ debts (Image: Getty)
Households are set to see their annual energy bills rise by at least £75 to cover debts from people who fail to pay, EDF warns. The energy provider says household debt will reach £7billion next year as Brits continue to face a cost-of-living crisis and a “culture of non-payment” develops.
EDF warns that the amount it adds to customer bills to offset the debts of others will reach £75 per year in 2027 to avoid suppliers losing money. The energy giant said: “Debt-related costs today add around £60 to the typical annual energy bill.
READ MORE: Ed Miliband told to scrap solar farms on Britain’s fertile farmland
READ MORE: UK households urged to ‘switch off and unplug’ appliances on Tuesday
“Industry experts have estimated that debt reaching £7bn this year would require a further £10 to £15 per year to be added, driving up energy bills further and pushing more households into debt.”
The warning comes a day before energy regulator Ofgem reveals the level of the annual energy price cap for July to September. Predictions suggest a 13% rise is on the way.
Analysts Cornwall Insight estimated last week the cap will rise by £209 a year to £1,850 from July 1 – an increase of 13% on April’s £1,641 annual cap.
Ofgem allows energy suppliers to add to paying customers’ bills to make up for some of the debts run up by some households.
EDF maintains Britain’s current regulations fail to keep pace with the issue, making it too easy for consumers to fall into debt and for suppliers to do nothing about it.
Our community members are treated to special offers, promotions, and adverts from us and our partners. You can check out at any time. Read our Privacy Policy
The energy giant, quoted by the Telegraph, says: “Regulatory protections designed for vulnerable consumers are, for example, shielding some customers who can and should pay.”
National Energy Action told the publication that evidence shows arrears are driven by “sustained unaffordability” as opposed to “disengagement”.
A spokesman says: “Once rent, food, and other essentials are covered, there is no capacity to absorb rising energy costs. Debt emerges immediately in these conditions, even where households are actively trying to keep up.”
Calls have been mounting for the Government to set out action to support the most vulnerable during the latest energy price shock.
Chancellor Rachel Reeves stopped short of any immediate energy measures in her cost-of-living plan.
Campaigners have warned of an “extremely difficult winter” ahead for the most vulnerable without extra support on bills.
Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said: “Households need reassurance and support, not a summer of suspense.
“That means the Government must act before winter to spell out what support will be available.”
The Government insists that tackling the affordability crisis is its number one priority.
