Ofgem Energy Debt Relief Scheme 2026: Who Qualifies and How It Works

If you have energy debt from the cost-of-living crisis, you may have heard about the Ofgem energy debt relief scheme and the possibility of having some of your arrears written off. The scheme is aimed at households with eligible energy debt built up during the crisis years, but not everyone with energy debt will qualify. So, who qualifies for the energy debt relief scheme, and how can you find out whether you are included?

The answer depends on when your debt was built up, whether you were receiving certain means-tested benefits, and whether you have met the scheme’s requirements around engaging with your energy supplier or additional support. Importantly, eligible households do not need to make a separate application, as energy suppliers are expected to identify qualifying customers through data matching.

However, this is not a blanket energy debt write off scheme. With millions of people across the UK carrying energy arrears, only a relatively small proportion are expected to benefit. This guide explains the latest eligibility rules, how the scheme works, what to do if you believe you qualify, and what it means if you have other household debts that the scheme does not cover.

Ofgem Energy Debt Relief Scheme 2026: Do You Qualify?

In order to qualify, there are several specific conditions you need to meet. The first phase is aimed at households with qualifying historic energy debt who were receiving means-tested benefits during the relevant period.

Who Qualifies for the Scheme?

For Phase 1, the key eligibility requirements include:

• At least £100 of eligible energy debt: You must have at least £100 of debt that meets the scheme’s definition of eligible debt.
• Debt accumulated during the specified period: The qualifying debt must have been built up between 1 April 2022 and 31 March 2024.
• Means-tested benefits: You must have been identified as receiving relevant means-tested benefits during the required period.
• Engagement with your energy supplier: You must meet the scheme’s engagement requirements. This can include making some contribution towards your current energy usage or debt. Customers who are considered disengaged may need to engage with an additional support option.

The scheme applies to domestic gas and electricity debt. It does not cover other types of household borrowing or bills, such as credit cards, council tax arrears, catalogue debt or personal loans.

Do You Need to Apply?

One important point is that you are not expected to make a standard application for the scheme. Energy suppliers are responsible for identifying potentially eligible customers through their own records and the relevant data-sharing arrangements with government departments.

This means you should not have to complete a form simply to ask whether you qualify. However, if you believe you meet the criteria but have not received any information from your supplier, it is worth contacting them directly. Ask whether your account has been assessed for the Debt Relief Scheme and whether you have been identified as a potentially eligible customer.

The scheme’s implementation has also been affected by the legislation and arrangements required for sharing benefits information. Therefore, not hearing from your supplier does not necessarily mean that you have been ruled out.

If your circumstances meet the eligibility criteria, your supplier should be able to explain what happens next and whether any further action is required from you.

How the £500 Million Energy Debt Write-Off Works

The scale of the scheme is one reason it has attracted so much attention. Ofgem announced a programme intended to provide substantial relief from historic energy debt, with up to £500 million earmarked for debt relief under the first phase.

The scheme was developed in response to the significant increase in energy debt following the 2022–2024 energy crisis. Rising household energy costs left many people unable to keep up with their bills, creating a large amount of arrears that continued to affect households after energy prices began to stabilise.

How Much Energy Debt Could Be Written Off?

Under the Phase 1 plans, around 195,000 households/customers are expected to benefit, with up to £500 million of qualifying historic debt potentially written off.

However, the £500 million figure should not be interpreted as £500 million being divided equally among everyone who currently owes money to an energy supplier. The amount of relief received by an eligible household depends on the debt that qualifies under the scheme.

The difference becomes clearer when you look at the wider energy debt problem. UK energy debt has been estimated at approximately £4.4 billion across 2.44 million people. Compared with that figure, the £500 million scheme represents targeted relief rather than a solution for the country’s entire energy debt problem.

This is why having energy debt does not automatically mean that you will benefit. The scheme is designed to reach a specific group of households rather than provide a universal cancellation of energy arrears.

What Does “Debt Written Off” Actually Mean?

When eligible debt is written off, the qualifying amount is removed from what the customer owes to their energy supplier. In practical terms, this means the customer should no longer be required to repay that particular amount.

However, a write-off under the scheme does not necessarily mean that an entire energy account balance disappears. For example, if a customer has £2,500 showing as arrears but only part of that balance qualifies for relief, any remaining amount can still be outstanding.

This distinction matters because the £500 million is a maximum amount of qualifying debt that may be written off, rather than a promise that every person with energy arrears will have their entire balance cleared.

The scheme therefore provides potentially significant help to the households it reaches, but its relatively limited coverage means that most people with energy debt will need to look at other ways of dealing with any arrears that fall outside the scheme.

What to Do If You Are Not Automatically Included

Not receiving a message from your energy supplier does not necessarily tell you whether you qualify. If you believe your circumstances match the scheme’s requirements, the most straightforward step is to contact your supplier directly.

Ask Your Energy Supplier to Check

Contact your gas or electricity supplier and ask whether your account has been assessed for the Debt Relief Scheme. You can explain that you believe you may meet the eligibility requirements and ask whether you have been identified through the relevant data-matching process.

Your supplier should also be able to explain what support is available if you are not eligible for the write-off. Depending on your circumstances, this could include repayment arrangements, hardship assistance or other support for customers struggling with their bills.

If your debt was accumulated partly or entirely outside the 1 April 2022 to 31 March 2024 period, it is particularly important to ask what options are available for that remaining balance. Debt that does not meet the scheme’s eligibility rules does not simply disappear because another part of your account qualifies.

What If You Have Other Debts Too?

Energy arrears are rarely the only financial pressure facing a household. Someone who struggled to pay gas and electricity bills during the energy crisis may also have fallen behind on council tax, credit cards, catalogue payments, personal loans or other household bills.

This is where it is important to understand the limits of the Ofgem scheme. Even if qualifying energy debt is written off, your other debts will remain. The scheme does not clear council tax arrears, credit card balances or other borrowing.

Likewise, if you do not qualify for the energy debt relief scheme, your energy arrears remain alongside any other debts you may already have.

For someone dealing with several types of debt at the same time, checking whether one particular bill can be reduced or written off may therefore only address part of the problem. Looking at the full household debt position can help you understand what needs to be dealt with and what forms of support may be available.

What the Ofgem Scheme Means for Your Wider Debt Situation

The Ofgem energy debt relief scheme could provide meaningful help if you meet the eligibility requirements, but it is important to see the write-off in the context of your wider finances. Whether you qualify or not, the scheme is only one part of dealing with household debt.

If You Qualify, What Happens to Your Debt?

If you are identified as eligible, some or all of your qualifying historic energy debt may be written off, depending on the amount of debt that meets the scheme’s rules. This could reduce the balance you owe to your energy supplier and make it easier to manage your ongoing energy costs.

However, a successful write-off does not mean that every debt you have disappears. If you have outstanding council tax, credit cards, catalogue payments, loans or other household bills, those balances remain your responsibility.

You may also have energy debt that falls outside the scheme’s qualifying criteria. That debt can remain payable even if part of your historic arrears is removed.

What If You Do Not Qualify?

If you are not eligible for the scheme, your energy debt does not simply disappear. You will need to discuss the available repayment, hardship or other support options with your supplier.

This can understandably be frustrating, particularly if you have been struggling with bills since the energy crisis. But it is important to distinguish between not qualifying for this particular scheme and having no options for dealing with your debt.

Ofgem’s eligibility framework also recognises the importance of engaging with additional support for some customers. For people who have become disengaged from their supplier, engaging with appropriate debt support can form part of the requirements for scheme eligibility. 

More broadly, seeking debt advice can help someone understand their options when energy arrears are part of a larger financial problem.

Look Beyond the Energy Bill

For many households, energy debt is not an isolated problem. The same period of financial pressure that made it difficult to pay electricity or gas bills may also have affected council tax payments, credit cards, loans and other household expenses.

That is why the Ofgem scheme should not be treated as a complete debt solution. If you qualify and your eligible energy debt is written off, you may have removed one significant financial pressure. But if several other debts remain, your overall financial situation may not change as much as you expected.

Similarly, if you do not qualify, focusing only on the energy bill may mean overlooking other debts that also need attention.

The most practical approach is therefore to check your eligibility with your energy supplier, establish exactly which debt may be covered, and then look at your wider financial position. If energy debt is only one part of what you owe, understanding the full picture is important before deciding what to do next.

The scheme may provide valuable relief for those who qualify, but whether you receive a write-off or not, dealing with multiple debts requires looking beyond a single household bill.

Conclusion

The Ofgem energy debt relief scheme could provide important financial relief for households with qualifying energy debt from the 2022–2024 crisis period. However, it is not a universal energy debt written off 2026 scheme. Eligibility is limited, and having energy arrears alone does not mean you will qualify.

If you believe you meet the criteria, contact your energy supplier and ask whether you have been identified for the scheme. Remember that any write-off applies only to eligible debt under the scheme’s rules, so other energy arrears and household debts can remain.

Most importantly, do not look at the scheme in isolation. If you are also dealing with council tax arrears, credit cards, loans or other bills, clearing eligible energy debt may only solve one part of the problem. Whether you qualify or not, understanding your complete financial position can help you identify the right support and decide what steps to take next.

The scheme may offer a valuable opportunity for those who qualify, but the best starting point is simple: check your eligibility, understand exactly what debt is covered, and consider your wider debts before deciding what to do next.

Key Points

• The Ofgem energy debt relief scheme is designed to help eligible households with historic domestic gas and electricity debt.
• Phase 1 focuses on at least £100 of qualifying debt accumulated between 1 April 2022 and 31 March 2024.
• Eligibility also depends on whether the customer was receiving means-tested benefits during the relevant period.
• Customers must meet the scheme’s engagement requirements, which can include contributing towards current energy use or engaging with additional support.
• Eligible customers generally do not need to submit an application, as energy suppliers are expected to identify them through relevant data-sharing arrangements.
• The scheme could provide up to £500 million in debt relief, with around 195,000 customers expected to benefit under Phase 1.
• The scheme is not a universal energy debt write-off. With around 2.44 million people carrying energy debt, roughly nine out of ten may not benefit from this specific scheme.
• Only eligible historic energy debt may be written off. Debt outside the qualifying period or outside the scheme’s scope can remain payable.
• If you believe you qualify but have not been contacted, you should contact your energy supplier and ask whether your account has been assessed for the Debt Relief Scheme.
• Even if energy debt is written off, other household debts such as council tax arrears, credit cards, loans and catalogue debt remain. Anyone dealing with multiple debts should consider their wider financial situation rather than relying on the Ofgem scheme alone.

FAQs

Can energy debt affect my credit score?

Potentially, yes. How energy debt affects your credit record can depend on your supplier, how the account is managed and whether the debt is reported to credit reference agencies. If you are concerned about your credit file, check your credit report and speak to your supplier about your account.

Will being on a prepayment meter affect my eligibility?

Not necessarily. Having a prepayment meter does not automatically mean you qualify or are excluded. Eligibility is determined by the specific requirements of the scheme, including the qualifying debt and benefits criteria.

Can I still receive energy support if I do not qualify for the scheme?

Yes. Not qualifying for the Ofgem Debt Relief Scheme does not mean you cannot receive other forms of support. Your supplier may have repayment arrangements, hardship assistance or other measures available depending on your circumstances.

What happens if I change energy supplier while waiting for debt relief?

Changing supplier does not automatically mean that your historic debt disappears. If you are considering switching while you have outstanding arrears, check with your current supplier how the debt will be handled and whether it could affect your account.