Energy debt-related costs data: October 2018 to June 2026
The amount of debt-related costs that energy suppliers who supply gas and electricity to households have to cover when people struggle to pay their energy bills.
Main points
- Bad debt charges remain the largest and most volatile component of debt-related costs.
- Since the updated allowances were introduced in Q3 2025, quarterly total costs have fluctuated between £266 million and £554 million, driven largely by seasonal movements in bad debt charges and write-offs.
- Debt administration costs have remained relatively stable, increasing gradually from £45 million to £67 million over the same period.
- The 12-month average of total debt-related costs has remained close to £400 million, indicating that underlying costs have been broadly stable since the introduction of the updated allowances.
Methodology
Data has been collected from energy suppliers with at least 100,000 customers who are on a standard variable tariff, where the maximum unit rate and standing charge are set by the energy price cap.
The data includes two types of energy debt-related costs, these are:
- Bad debt charge; this is the change in the amount of unpaid bills a supplier does not expect to recover, also known as bad debt provisioning, plus any debts newly confirmed as unrecoverable and therefore written off.
- Debt administration costs; these include costs such as legal or warrant costs, costs of non-warrant field visits, other communication costs, setting up payment plans, debt collection agencies, credit delivery costs and costs recharged to customers.