Select committee: Energy Security and Net Zero Committee

Conclusion 12

5th Report - Tackling the energy cost crisis Published 29 Oct 2025 Addressed to Department for Energy Security and Net Zero

Energy Security and Net Zero Committee The cost of energy All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗

Conclusion (the committee's words)

The UK is experiencing a severe energy debt crisis that shows little sign of abating. Millions of customers currently owe more than £4bn in debt and arrears, a record figure that has more than tripled in just five years. This is having a devastating impact on the wellbeing of millions, while increasing energy bills for everyone. We welcome Ofgem’s proposals for an Energy Debt Relief Scheme, but a more permanent solution is clearly needed to tackle both an energy debt and energy affordability crisis. (Conclusion, Paragraph 48) 45

From: Energy Security and Net Zero Committee, 5th Report - Tackling the energy cost crisis (HC 736), 29 October 2025

Government response

6th Special Report - Tackling the energy cost crisis: Ofgem Response

The government responded to the whole report on 19 March 2026 (deadline 29 December 2025).

Summary written by Accountability Index from the government's response. It is not the government's own words.

Ofgem agrees with the Committee on some points, including the scale of energy debt, but does not agree that windfall profits should fund the Debt Relief Scheme and sets out why it is not adopting several other recommendations.

On debt, Ofgem intends to deliver the Debt Relief Scheme in two phases "throughout 2026", with Phase 1 expected to help 200,000 customers and remove up to £500 million of debt. It proposes recovering costs from domestic customers, and "does not expect the DRS to remain a permanent feature of the energy market".
On the payment method premium, Ofgem does not agree that the financially vulnerable are "universally expected to pay more". It says a single cap would increase bills for the majority of financially vulnerable customers.
On standing charges, Ofgem says it does not set the level of the charge. It will provide an update "later this spring", has begun a Cost Allocation Review, and is "not proposing immediate changes" on prepayment meter standing charges.
On non-domestic customers, Ofgem's judgement is that there are "significant risks and challenges" in a price cap. It does not consider a 14-day cooling off period "likely to solve the issue", and awaits Government legislation to become the regulator for energy brokers.

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4th Special Report – Tackling the energy cost crisis: Government Response

Published 21 January 2026.

Summary written by Accountability Index from the government's response. It is not the government's own words.

The government sets out existing and planned measures on energy costs, and in several areas, including a social tariff, back billing limits and business discount schemes, says it will explore options or leaves the matter to Ofgem rather than adopting the Committee's specific recommendations.

On the Warm Home Discount, it "notes" the Committee's call to extend eligibility and raise the £150 rebate, keeps the value at £150 because the scheme is levy funded, and says it will "explore improvements" in the next scheme period, with significant changes "subject to further consultation".
On a social tariff, it says the Warm Home Discount "could be considered a form of a social tariff" and makes no commitment to the consultation by January 2026 or to a tariff ahead of winter 2026-27.
On back billing and the price cap, it calls these matters for Ofgem as independent regulator. It agrees customers should receive accurate bills and will "continue to work with Ofgem" on smart meter back billing rules.
On business support, it will "continue to assess ways to support business with high energy costs" and engage with Make UK on the opt-in discount scheme, and says the British Industrial Competitiveness Scheme launches in 2027.

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