EDF offers further support for its most vulnerable this winter, as it issues warning on rising debt costs

• Vulnerable customers in financial difficulty to be offered help with debts this winter
• Since last year, the number of customers owing money, with no plan to get out of debt, increased by 52%
• Majority of households don’t want bills to increase to subsidise the bills of those who can’t or don’t pay – but the debt surcharge could rise
• EDF is calling on Ofgem and Government to create central database of vulnerable households and consult on a social tariff as soon as possible

EDF has promised to wipe the debt of some of its most vulnerable customers this winter, whilst warning that Government and Ofgem must take urgent action to protect households from rising debt costs.

EDF will target vulnerable customers experiencing hardship with the opportunity to have their debt cleared as part of its ‘fresh start’ initiative, with eligible customers receiving an average of £1,250. Customers do not need to apply to the scheme and EDF will contact eligible customers in the coming weeks.

This comes as pressure grows over rising debt levels, which could increase bills for everyone to cover the costs of those who cannot or do not pay. Currently the surcharge is up to £120 on a typical bill*.

In October, Ofgem indicated that it was reviewing a potential increase to debt costs on bills as energy debt reached its ‘highest ever level’. EDF data shows that between December 2022 and September 2023, debt with no plan in place increased by 52%.

This comes as new research by EDF shows that 65% of households do not want to see bills increase to cover costs generated by other customers. Energy featured as the top household cost that people are worrying about most (66%).

This winter EDF has boosted support available by £15m, creating a total support fund of more than £40m for the coming year, which includes providing debt relief and payment matching. However, the supplier is unable to offer this support unilaterally and indefinitely.

EDF is calling on Ofgem and the Government to:

• Push ahead with plans to consult on a targeted social tariff as soon as possible
• Create a central database of vulnerable households using government data, building on plans for a cross utility Priority Services Register. This database would help suppliers target support such as a social tariff and automatically flag up customers where a relevant vulnerability would exclude them, for example, from involuntary prepay actions. 

Philippe Commaret, MD of Customers at EDF, said: “More customers are falling deeper into debt with no real long-term solution in place to help them. Left unaddressed, the situation will drive up costs for all households, with other customers forced to pick-up the bill.

“We must make sure the most vulnerable in society are being protected and this includes stopping bills rising further. We’re taking action to help those in need, but vulnerable customers need a long-term, sustainable approach to tackle affordability.”

When asked whether a potential £17 increase to bills (Ofgem's previous estimate before today's announcement) to cover debts was acceptable, the majority (56%) of those surveyed said it was not acceptable in any circumstance. Among those unhappy about possible bill increases of even a small amount (65%), the top solution cited to stop increasing debt costs going onto bills was introduction of a social tariff (28%).

Customers eligible for its ‘fresh start’ debt clearance scheme will be contacted by EDF in the coming weeks. Customers will be identified based on the information available to EDF on the status of vulnerabilities and evidence of ongoing financial difficulty (applications to EDF’s Customer Support Fund, Warm Home Discount eligibility and continuous attempts to make payments). Support will also be provided in instances where EDF is concerned a customer might be self-disconnecting.

Notes to Editors:

*Ofgem estimates that current typical debt costs on an energy bill range from £19 for a direct debit or PAYG customer to £120 for a standard credit customer.

**EDF is supporting Government’s ‘It all adds up campaign’ to promote the simple steps customers can take to make savings on their energy bills this winter.

Research conducted with 2,098 members of the UK public, ages 18+ by Portland Communications. Polling was conducted online between Friday 10^th and Monday 13^th November 2023. Data were weighted to most recent national estimates for age, gender and region.