Response to Ofgem’s Statutory Consultation on the Debt Relief Scheme (DRS)

Citizens Advice response to Ofgem’s Statutory Consultation on the Debt Relief Scheme (DRS) 242 KB

Citizens Advice welcomes the opportunity to respond to Ofgem’s Statutory Consultation on the proposals for the Debt Relief Scheme (DRS). As we stated in our response to the working paper in August 2025, we believe the scheme has the potential to deliver significant benefits for both consumers and suppliers by reducing debt in the energy market, supporting vulnerable households and improving relationships and trust between consumers and their suppliers. To maximise the benefit of the scheme, Ofgem must ensure suppliers have the right support in place for consumers to get to a sustainable position, and the scheme should be funded from the network windfall rather than consumers.

Debt levels in the energy sector are at a record high - largely driven by the increase in prices of domestic gas and electricity in the energy crisis period - and energy bills continue to be a source of financial distress for consumers. Many households are struggling to pay their bills for ongoing usage even before they try to repay their debts. 

Our summer survey with Yonder Consulting found that 7.4 million households (26%) have some difficulty reliably affording their energy bills. Stubbornly high energy bills are causing people to fall deeper into debt. In October 2025, the average level of debt held by people who Citizens Advice helped was £1,709, which is more than a £200 increase from the previous year. 

Ofgem’s debt relief scheme is a welcome first step to supporting households that are struggling with the impossible weight of debt. It is an opportunity to support both suppliers and consumers to find a sustainable solution to the problem of debt. We encourage Ofgem to deliver the scheme as soon as possible to ensure a substantial proportion of debt is written off, resulting in the scheme having a meaningful impact on overall debt levels.

Additionally, to improve the success of the debt relief scheme in delivering meaningful debt relief, the Government should also tackle the problem of energy affordability. We welcome the Government’s expansion of the Warm Home Discount and announcements in the Autumn Budget to improve energy affordability. This should be followed by further improvements to targeted bill support, further action to upgrade homes, and reducing more of the levies off of electricity to make bills cheaper so people can benefit from clean power and switch to electric heating.