Energy price cap: review of historical debt related costs
This consultation is open for responses
Closes 16 Jun 2026 (72 days remaining)
Summary
Ofgem reviews the temporary debt cost allowance it added to the energy price cap between April 2022 and June 2025, comparing actual supplier debt costs against the allowances received. The consultation closes 16 June 2026 and focuses specifically on whether the temporary allowance was set correctly, with potential price cap adjustments if not. The review excludes broader debt strategy considerations.
Why it matters
This is redistributive policy that socialises supplier debt costs onto all customers rather than addressing why energy became unaffordable. As such, it treats the symptoms of expensive energy without fixing the underlying supply constraints or market structure that created the debt crisis.
Key facts
- •Temporary allowance covered April 2022 to March 2024 initially, extended 3 months before permanent replacement
- •Consultation closes 16 June 2026
- •Confidentiality ring access requires registration by 21 April 2026
- •Review compares actual debt costs against allowances received
Timeline
Areas affected
Memo
Energy price cap: review of historical debt related costs | Ofgem Please enable JavaScript in your web browser to get the best experience. BETA This site is currently in BETA. Help us improve by giving us your feedback . Close alert: Energy price cap: review of historical debt related costs Publication type: Consultation Publication date: 25 March 2026 Closing date: 16 June 2026 Status: Open Topic: Energy pricing rules Subtopic: Energy price cap Get emails about this page Print this page Share the page Share on Facebook Share on Twitter Share on LinkedIn We are seeking views on our review of the temporary debt related costs allowance added to the energy price cap between April 2022 and June 2025. Consultation description We introduced a temporary allowance to reflect the higher than expected debt costs that suppliers incurred between 1 April 2022 and 31 March 2024. The temporary allowance was initially applied for 12 months but was extended for another 3 months before being replaced by a permanent allowance. We are now reviewing the temporary allowance to check if it was set at the right level and if not whether any new adjustment to the price cap is needed. To do this we have analysed data on suppliers' actual debt costs and compared them against the allowances they received. This consultation focuses on the energy price cap and is not part of any wider actions being considered as part of our debt strategy. Request models and data As part of this consultation, we will make models and data available to those who would like to view them through a confidentiality ring. To view this information, you will need register your interest by emailing priceprotectionpolicy@ofgem.gov.uk . You will need to submit a draft compliance document and signed undertakings by Tuesday 21 April 2026. Who should respond We would like views from people who have an interest in how we set the debt-related costs allowance in the energy price cap. This includes: energy suppliers energy industry bodies consumer groups charities consumers How to respond Submit your response by 16 June 2026 by emailing priceprotectionpolicy@ofgem.gov.uk . Consultation documents Debt-related costs true-up consultation document Disclosure notice Legal undertaking templates Compliance statement guidance Consultation documents Energy price cap: review of historical debt related costs [PDF, 446.04KB] Disclosure notice [PDF, 109.11KB] Template confidentiality undertaking: advisor - disclosed data [DOCX, 102.96KB] Template confidentiality undertaking: advisor - disclosed model and data [DOCX, 101.48KB] Template confidentiality undertaking: authorised attendee - disclosed model [DOCX, 98.98KB] Template confidentiality undertaking: firm - disclosed data [DOCX, 102.01KB] Template confidentiality undertaking: firm - disclosed model and data [DOCX, 101.94KB] Template confidentiality undertaking: relevant party - disclosed model [DOCX, 101.75KB] Compliance statement guidance [PDF, 122.40KB] Get emails about this page Print this page Share the page Share on Facebook Share on Twitter Share on LinkedIn Close Notify me Would you like to be kept up to date with Energy price cap: review of historical debt related costs ? subscribe to notifications: Email Submit Close