Utility debt is money you owe for gas, electricity, or water. These are priority debts because energy suppliers can disconnect your supply or force you to have a prepayment meter if you don’t pay. Water companies can’t disconnect you, but they can take you to court.
If you’re struggling with utility debt, contact your supplier immediately to arrange a payment plan. If you have other debts too (totalling £6,000+), an IVA might help, but you’ll still need to keep paying your utility bills separately as they’re priority debts.
What Counts as Utility Debt?#
Utility debt includes arrears on:
- Gas
- Electricity
- Water
Some people also consider other household services as utilities (broadband, phone line, mobile contracts), but these aren’t priority debts. You can’t be disconnected from broadband or phone service in the same way you can be cut off from gas or electricity.
In Scotland, water charges are included in your council tax bill. In England, Wales, and Northern Ireland, you pay water companies separately.
Why Utility Bills Are Priority Debts#
Gas and electricity are priority debts because suppliers can disconnect your supply if you don’t pay.
Being disconnected means:
- No heating in winter
- No hot water
- No way to cook food
- No way to power essential appliances (fridge, freezer, medical equipment)
Water is also a priority debt, but water companies can’t disconnect your supply under any circumstances. It’s illegal in the UK. But they can still take you to court for a CCJ and enforce it through bailiffs or attachment of earnings.
This is why you should always prioritise utility bills over non-priority debts like credit cards, loans, or overdrafts.
What Happens If You Don’t Pay Your Utility Bills#
If you stop paying your gas or electricity bills, here’s what happens:
Weeks 1-4: Reminder letters
Your supplier sends reminder letters asking you to pay your overdue bill. They might call you as well.
Weeks 4-8: Debt collection letters
The tone gets more serious. The supplier warns that they’ll take further action if you don’t pay or contact them to arrange a payment plan.
Weeks 8-12: Warrant to fit a prepayment meter
If you’re still not paying or engaging, the supplier can apply to a magistrate for a warrant to enter your home and install a prepayment meter.
A prepayment meter means you pay for energy upfront. The supplier also adds your arrears to the meter, so part of every top-up goes toward clearing what you owe.
After 12+ weeks: Disconnection (rare)
Disconnection is rare and only happens in extreme cases where you’ve refused all attempts to resolve the situation. Suppliers must follow strict rules before disconnecting you.
They can’t disconnect:
- In winter (October to March) if you’re over 75 or have children under 5
- If someone in your household relies on medical equipment powered by electricity
- Without giving you proper notice and attempting to contact you first
Water companies can’t disconnect you at all. But they can take you to court and get a CCJ, which they can enforce through bailiffs or attachment of earnings.
Can Utility Suppliers Force You to Have a Prepayment Meter?#
Yes, but only if they get a court warrant.
A prepayment meter (PPM) is a pay-as-you-go system. You top up the meter with credit, and it deducts money as you use gas or electricity.
If you have arrears, the meter automatically deducts a small amount from each top-up to pay off what you owe. This is called “arrears recovery.”
Under the Energy Act 2023, suppliers must offer you a payment plan first. They can only install a PPM if:
- You’ve refused to engage with them
- You’ve broken a previous payment plan
- You’ve refused to allow them access to install the meter voluntarily
Suppliers can’t force a PPM on vulnerable customers, including:
- People over 75
- People with severe health conditions
- People who rely on medical equipment powered by electricity
- People with serious mental health conditions
If your supplier wants to force a PPM and you’re vulnerable, tell them immediately. Provide evidence (doctor’s letter, medical certificates) if you can.
Can Utility Debt Be Included in an IVA?#
Not directly, but yes in a roundabout way.
Utility debts are priority debts, which means they’re not usually included in an IVA. You have to keep paying them separately throughout your IVA.
But if you have arrears on utility bills that have already been sent to debt collectors or have resulted in a CCJ, you might be able to include those historic arrears in your IVA.
For example:
- You owed £1,500 to your energy supplier
- They closed your account and sold the debt to a debt collector
- You’ve since switched to a new supplier and are keeping up with current bills
- The historic £1,500 debt can be included in your IVA
But your current utility account (the one supplying your energy now) must be kept up to date. IVAs don’t cover ongoing priority debts.
If you have multiple debts (credit cards, loans, utility arrears) totalling £6,000+, check if you qualify using our free IVA calculator.
Can Utility Debt Be Included in a Debt Relief Order?#
Same rule applies. Current utility bills are priority debts and must be paid separately. But historic utility arrears that have been closed or sold to debt collectors can be included in a DRO.
A DRO is suitable if you have:
- Less than £50,000 total debt
- Less than £75/month spare income after essential expenses
- Less than £2,000 worth of assets
It’s free to apply (as of April 2024) and lasts 12 months, then all included debts are written off.
Government Help with Energy Bills#
If you’re on a low income or claiming benefits, you might be eligible for government schemes to help with energy costs:
Warm Home Discount Scheme
£150 discount on your electricity bill if you’re on Pension Credit or meet the low-income criteria. Applied automatically between October and March.
Winter Fuel Payment
£200-£300 payment if you were born before September 1958. Paid automatically if you claim State Pension or certain other benefits.
Cold Weather Payment
£25 for each week of very cold weather (average temperature below 0°C for 7 consecutive days). Paid automatically if you’re on certain benefits like Pension Credit, Universal Credit, or Income Support.
Fuel Direct Scheme
If you’re on certain benefits (Universal Credit, Income Support, Pension Credit), you can have money deducted directly from your benefits to pay your energy arrears.
A fixed amount is taken each week to cover your arrears plus an amount for current usage. Contact Jobcentre Plus to set this up.
Energy Company Grants
Many energy companies offer hardship grants and schemes, even if you’re not their customer. Check British Gas Energy Trust, E.ON Energy Fund, or Scottish Power Hardship Fund.
Visit Citizens Advice or contact your local council for more help with energy costs.
How to Negotiate with Your Utility Supplier#
If you can’t afford your utility bills, contact your supplier as soon as possible. Don’t wait for them to chase you.
Most suppliers have specialist teams to help customers in financial difficulty. They’re more willing to work with you if you contact them before you get too far behind.
Options your supplier might offer:
Payment plan: Spread your arrears over 3-12 months while keeping up with current usage. You’ll pay a fixed amount each month covering both arrears and current bills.
Temporary payment break: If you’ve had a sudden loss of income (redundancy, illness), they might pause payments for 1-3 months.
Reduced payments: If you’re on a low income, they might accept lower payments based on what you can afford.
Debt write-off: Some suppliers have schemes to write off part of your debt if you’re in severe financial hardship and have kept up payments for a period (usually 12-24 months).
Social tariff: Cheaper energy rates for vulnerable customers or those on low income.
Get everything in writing. If your supplier won’t help or you’re not happy with their offer, contact Citizens Advice consumer helpline for free advice.
Switching Suppliers While You Owe Money#
You can’t switch energy supplier if you owe more than £500 in arrears.
If you owe less than £500, you can switch, but you’ll still have to pay what you owe to your old supplier. The debt doesn’t disappear.
If you want to switch and you have arrears, your options are:
- Pay off the arrears in full before switching
- Arrange a payment plan with your current supplier, then switch once the arrears are below £500
Don’t just stop paying your old supplier after switching. They’ll continue chasing the debt, and it can escalate to debt collectors or court action.
What If You Have Utility Debt Plus Other Debts?#
If you’re struggling with utility arrears and other debts (credit cards, loans, overdrafts), prioritise the utility bills first.
Utility bills are priority debts. Missing payments can lead to disconnection or prepayment meters. Non-priority debts (credit cards, loans) can’t cut off essential services.
But if your other debts total £6,000+, consider a debt solution:
IVA: Write off remaining debt after 5-6 years. You’ll need to keep paying utility bills separately, but the IVA deals with credit cards, loans, and overdrafts.
Debt Management Plan: Informal agreement to pay creditors reduced monthly payments. Doesn’t include utility bills, but frees up money by reducing payments on other debts.
Debt Relief Order: Free to apply, writes off debts after 12 months. Historic utility arrears (if closed or sold to debt collectors) can be included.
Get free debt advice from StepChange, National Debtline, or Citizens Advice to work out the best solution.
Can Bailiffs Come for Utility Debt?#
Not directly. Bailiffs can’t enforce utility debt unless your supplier has taken you to court and got a CCJ.
If you ignore a CCJ for utility arrears and still don’t pay, your supplier can apply for bailiff enforcement. Bailiffs can then visit to seize goods to sell at auction.
But this is rare. Most suppliers prefer to install prepayment meters or use attachment of earnings rather than send bailiffs.
Read our guide on what bailiffs can and can’t do if you’re worried about enforcement action.
What If You Dispute Your Bill?#
If you think your utility bill is wrong, don’t ignore it. Contact your supplier immediately and explain why you think the bill is incorrect.
Common billing errors:
- Estimated readings instead of actual meter readings
- Charges for a period when you weren’t living at the property
- Incorrect tariff applied
- Admin errors (decimal point in wrong place, charges duplicated)
Ask your supplier to investigate and provide a detailed breakdown of charges. If you’re right, they’ll correct the bill and refund any overpayment.
If your supplier won’t help or you’re not satisfied with their response, escalate to the Energy Ombudsman (for gas and electricity) or Consumer Council for Water (for water bills). Both services are free.
While you’re disputing, keep paying what you think you owe. Don’t stop paying completely, or your supplier might take enforcement action.
If you’re struggling with debt and want to find out what options are available, use our free IVA calculator to see if you qualify and how much debt you could write off. It takes 2 minutes and won’t affect your credit score.
Frequently Asked Questions#
Can I include my current gas and electric bills in an IVA?#
No. Current utility bills are priority debts and must be paid separately throughout your IVA. Only historic utility arrears that have been closed or sold to debt collectors can be included in an IVA.
Will an energy supplier disconnect me if I’m paying something?#
Very unlikely. If you’re making regular payments (even if they’re less than the supplier wants), most suppliers won’t disconnect you. They’re required to work with customers in financial difficulty before taking enforcement action.
Can I get a prepayment meter removed?#
Yes, but you need to contact your supplier and request it. They’ll usually agree if you’ve cleared your arrears or have kept up a payment plan for several months. You might need to pass a credit check before they’ll switch you back to a standard meter.
What if I can’t afford to top up my prepayment meter?#
Contact your supplier’s emergency team. They can provide emergency credit (usually £5-£10) to keep your supply on until you can top up. If you’re struggling long-term, ask about payment plans or hardship schemes.
Can water companies take me to court?#
Yes. Water companies can’t disconnect your supply, but they can apply for a CCJ if you don’t pay. Once they have a CCJ, they can enforce it through attachment of earnings or bailiffs. Treat water bills as priority debts.
What if I move house and owe money to my old supplier?#
You still owe the money. The debt doesn’t disappear when you move. Your old supplier will send the final bill to your forwarding address. If you don’t pay, they can pass the debt to debt collectors or take you to court.
If you’re struggling with utility debt and other debts, use our free IVA calculator to see if you qualify and how much debt you could write off. It takes 2 minutes and won’t affect your credit score.