Households across Great Britain could owe energy suppliers up to £7bn by the end of 2026, according to industry group Energy UK, as higher gas and electricity prices set to take effect this winter push more customers into arrears. The warning comes ahead of an expected regulatory announcement this week confirming a 4% rise in the energy price cap from October, which would more than cancel out the government's planned VAT cut on electricity bills. Energy UK's chief executive has called for a more permanent solution, such as a targeted social discount tariff, rather than temporary emergency measures.

Domestic energy debt has already risen by about £500m over the past year to a record £6bn by the end of June, driven partly by rising gas prices linked to the Middle East conflict. Under the anticipated price cap rise, a typical household bill would reach £1,729 a year in the final quarter of 2026, with electricity and gas unit rates both increasing; using the previous calculation method, the cap would climb to £1,940.69, the highest since summer 2023. Energy UK's debt figures run about £1bn higher than Ofgem's official count, as the regulator only records debt once bills are 90 days overdue, though it uses the higher estimate to spread unpaid-bill costs across all consumers, adding roughly £50 (about 3%) to a typical annual bill.