With the current cost of living crisis and a continuing rise in energy prices, you may find yourself in a position where this contributes to a squeeze on your finances. So, what options do you have, and what potential solutions are there if you cannot pay your energy bills?
What happens if you can’t pay your bill?
The first step is that your energy supplier will write to you informing how much you owe and request that a payment to cover the outstanding balance will need to be made.
Your energy supplier (for electricity or gas) should provide you with options to pay using a payment plan, which may include an extra penalty fee for late payments. If you’re not already on a prepayment smart meter, your supplier may switch you to one.
There can be instances when your supplier needs to notify you that they will disconnect your energy supply if your bill payment is over 28 days late. However, if you’re a pensioner who lives alone, with another pensioner, or with children under 18 – you cannot be disconnected between October 1st and March 31st.
In the event you don’t pay for an extended period, a debt collection agency may become involved, which can incur an extra cost to you and also damage your credit score, making it more difficult to borrow money or get a mortgage down the road.
Steps you can take to help pay your energy bills
If you can’t pay your bills, don’t panic – there are potential things you can do to put yourself in a better position:
- Discuss options – notify your supplier if you’re struggling, they should be able to create a payment plan. Some have also set up hardship funds to assist those who need it, along with providing temporary credit if you have a prepayment meter.
- Pay what you can – even if you can’t pay the entire balance, paying off part can bide some time and keep the supplier from escalating things. They may even provide a payment break or more time to pay.
- Switch tariffs – you may be better off on a fixed-rate energy deal (if you can find a decent option and have the ability to move).
- Check for support and benefits – it’s also worth ensuring you’re claiming any benefits you’re entitled to and registering on the Priority Services Register (PSR).
- Reduce usage – although this won’t help with past bills, cutting down usage where possible will help make sure you don’t get sucked into a debt spiral with your energy bills.
- Save elsewhere – it could be worth exploring options like remortgaging onto cheaper rates to cut mortgage payments, using cheaper transport, or taking smaller steps like strict budgeting with grocery shopping.
Will the UK government help with energy bills?
Yes! As part of the government’s ‘cost of living support’ package, all households are in the process of receiving a £400 grant spread out over instalments between October 2022 and March 2023.
There are also several government supports you may qualify for: