Millions of British households are facing a fresh financial squeeze as rising energy costs push more families into debt and expose the growing strain on household finances.
Research published ahead of next month’s increase in the energy price cap suggests that around one in three adults are either already behind on their energy bills or fear they could struggle to keep up with payments in the months ahead.
The findings underscore how the cost-of-living crisis continues to cast a long shadow over many households despite broader signs that inflation has moderated.
The warning comes as energy bills are set to rise by 13 per cent in July, adding further pressure to families already contending with elevated housing costs, food prices and borrowing expenses.
Campaigners say the figures reveal a worsening affordability crisis rather than a simple payment problem. Among households already in arrears, average energy debt has climbed to approximately £750, while total energy debt across Britain has reached £5.5 billion — more than double levels seen in recent years.
The consequences are increasingly visible in day-to-day life.
Households struggling with energy costs report cutting back on heating, reducing hot water use and limiting other essential consumption in an effort to manage bills. Others say they have reduced food spending, relied on food banks or fallen behind on rent and mortgage payments.
Perhaps most concerning is evidence that some households are turning to informal and potentially dangerous forms of borrowing. A significant proportion of those either in debt or worried about falling behind said they owed money to individuals who made them feel intimidated or fearful, highlighting how financial distress can spill beyond conventional lending markets.
The pressure appears particularly acute among families with children and disabled people, both groups that often have higher unavoidable energy needs. Nearly half of parents with dependent children reported concerns about falling into energy debt, while disabled households continue to face disproportionate exposure to rising utility costs.
The findings present a challenge for both policymakers and energy suppliers.
While suppliers have expanded support schemes and repayment options in recent years, many customers remain dissatisfied with the assistance available. Relatively few households in arrears believe they have been treated fairly, while only a small minority report being directed towards independent debt advice.
The data also reignites debate over how Britain should address the growing stockpile of unpaid energy bills. Campaign groups are calling for targeted debt-relief measures, arguing that many households accumulated arrears during periods of exceptionally high wholesale gas prices and now have little realistic prospect of repaying them.
However, energy experts caution that debt write-offs alone would not tackle the underlying problem. Britain’s housing stock remains among the least energy-efficient in Western Europe, leaving many households exposed to volatile energy markets and structurally higher bills.
The challenge for ministers is that the crisis increasingly extends beyond energy policy. Rising utility costs are feeding into wider financial stress, affecting housing security, food affordability and consumer spending at a time when economic growth remains fragile.
With bills set to rise again next month, the prospect of energy debt reaching the £7 billion level forecast by some industry analysts is becoming an increasingly realistic possibility. For many households, the question is no longer whether energy costs are creating hardship, but how much more pressure they can absorb before the financial strain becomes unsustainable.
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