Energy Debt is Rising. Are We Equipping Advisors for the Conversations That Matter Most?
As energy debt reaches record levels and Government and regulators introduce new measures to tackle the crisis, the ability of frontline advisors to build trust, recognise vulnerability and navigate difficult conversations has never been more important.
The UK’s energy debt challenge has reached a critical point
Behind the billions owed to energy suppliers are millions of households managing financial pressures, uncertainty and difficult decisions about essential living costs.
For suppliers, the challenge is equally complex: managing growing debt, protecting vulnerable customers, meeting regulatory expectations and maintaining commercial performance.
The Government and Ofgem are responding with measures to tackle historic debt and prevent further arrears. But alongside financial support and regulatory reform, another question deserves attention.
Are we equipping frontline advisors with the skills and confidence to have the conversations that matter most?
The scale of the energy debt challenge
The latest Ofgem figures illustrate the growing pressure.
By Q2 2026, domestic electricity and gas debt and arrears had reached £5.02 billion, approximately 13% higher than the same period in 2025.
Average arrears for customers without a repayment arrangement had risen to £1,872 for electricity and £1,613 for gas.
Government statistics provide further context. The Department for Energy Security and Net Zero estimated that 2.36 million households in England were living in fuel poverty in 2025, while approximately 7.63 million households needed to spend more than 10% of their income after housing costs on energy.
Ofgem’s consumer research also found that 40% of consumers were keeping up with their energy bills but struggling to do so.
These figures highlight a fundamental challenge: financial difficulty is rarely straightforward.
For customer-facing teams, conversations about outstanding payments can quickly become discussions about affordability, personal circumstances, vulnerability and trust.
The headline numbers
£5.02 billion
Total domestic energy debt and arrears by Q2 2026
£1,872
Average electricity arrears
(without a repayment arrangement)
£1,613
Average gas arrears
(without a repayment arrangement)
2.36 million
Households in England living in fuel poverty in 2025
7.63 million
Households spending more than 10% of their income after housing costs on energy
40%
Of consumers are keeping up with their energy bills but struggling to do so
Government action: what does it mean for suppliers?
In October 2026, the Government and Ofgem announced the Energy Debt Circuit Breaker, a strategy built around three principles: Relief, Repayment and Reform.
Measures include a proposed Debt Relief Scheme, expected in spring 2027, targeting eligible debt accumulated during the 2022–2024 energy crisis. Ofgem estimates that up to 2.4 million customers have historical debt potentially eligible for consideration, although not all will qualify.
Alongside this, the Government has extended the £150 Warm Home Discount through winter 2030/31, with approximately six million households expected to benefit in 2026/27.
These interventions are important, but their effectiveness will also depend on how customers understand and engage with the support available. Some will need reassurance. Others may be frustrated, sceptical or reluctant to engage.
Policies establish what support should be provided. The behaviours and judgement of frontline advisors help translate those policies into meaningful customer outcomes.
Why the quality of conversations matters
Consider two customers contacting their energy supplier about outstanding payments. Both have accumulated arrears, yet their circumstances may be entirely different. One may have experienced a temporary reduction in income. Another may be managing long-term hardship, health challenges or competing financial commitments.
A standardised conversation focused solely on securing payment risks overlooking these differences.
An advisor who listens effectively, recognises behavioural cues and adapts their approach is better placed to understand individual circumstances and identify appropriate solutions.
This doesn’t mean overlooking commercial realities. It means recognising that constructive customer conversations and sustainable commercial outcomes are not competing objectives.
When customers feel understood and know their options, they may be more willing to engage and work towards realistic solutions.
Moving beyond scripts: developing behavioural capability
An advisor might understand repayment options yet struggle when a customer becomes distressed. They may know vulnerability procedures but lack confidence exploring sensitive circumstances.
These situations require practical behavioural capabilities:
Building
trust
Active
listening
Behavioural
awareness
Adaptability
Sound
judgement
Confidence
- Behavioural awareness: Understanding different responses to pressure.
- Building trust: Helping customers feel respected and understood.
- Active listening: Recognising underlying concerns and barriers.
- Sound judgement: Balancing empathy with appropriate action.
- Adaptability: Adjusting communication to individual circumstances.
- Confidence: Managing emotionally demanding conversations effectively.
These skills cannot be developed through procedural knowledge alone. They require practice, feedback and opportunities to apply learning in realistic situations.
Supporting customers in financial difficulty: lessons across sectors
Energy suppliers and financial services organisations share important challenges.
Both operate in regulated environments, balance commercial objectives with customer protection and manage conversations involving financial difficulty and vulnerability.
DSW has designed and delivered tailored behavioural development solutions for debt recovery teams at Nationwide Building Society and Virgin Money.
Our approach brings together three complementary elements.
Understanding what
builds trust
Using principles from the Trust Equation, advisors explore behaviours that influence credibility, reliability, empathy and customer confidence.
Recognising different
customer behaviours
Drawing on a dimensional model of behaviour, advisors learn to recognise different responses and adapt their communication appropriately, without making assumptions about customers.
Applying a structured
conversation framework
A practical six-step approach provides consistency while allowing flexibility for individual circumstances.
Together, these elements help advisors develop the confidence, judgement and adaptability required for complex conversations.
For energy suppliers, the opportunity is to apply these established principles within their own operational and regulatory environment.
The business case for better conversations
Supporting vulnerable customers and improving commercial performance should not be viewed as opposing priorities.
Ineffective conversations can contribute to customer disengagement, unsustainable repayment arrangements, repeated contact, complaints and additional operational costs.
Developing stronger behavioural capability creates opportunities for:
Better customer
engagement
Encouraging constructive discussions and appropriate access to support.
More sustainable
repayment outcomes
Identifying realistic arrangements based on individual circumstances.
Improved customer
experience
Building confidence through respectful, consistent communication.
Greater advisor
confidence
Equipping employees to manage challenging situations effectively.
Operational
efficiency
Potentially reducing avoidable repeat contacts and escalations.
These benefits should be evaluated through measures such as repayment sustainability, customer feedback, quality assurance, repeat contact and advisor confidence.
The opportunity is not simply to deliver training, but to develop capabilities that support lasting improvements in customer and business outcomes.
From learning to lasting behavioural change
Effective development goes beyond attending a training programme. Advisors need opportunities to practise challenging scenarios, receive feedback and apply new approaches in everyday interactions.
Managers also play an essential role, reinforcing effective behaviours through coaching and ongoing quality assurance.
DSW’s approach connects behavioural insight with practical application, helping organisations move beyond knowledge acquisition towards meaningful capability development.
The real measure of success isn’t whether employees have completed training, but whether they demonstrate greater confidence, better judgement and more effective behaviours when supporting customers.
A defining opportunity for energy suppliers
The Government and Ofgem’s latest interventions demonstrate that tackling energy debt requires coordinated action.
Financial relief, regulatory reform and stronger customer protections all have important roles to play. But so does the capability of the people responsible for delivering them.
Ofgem’s October 2026 guidance on behavioural strategies for preventing and reducing energy arrears further reinforces the importance of understanding customer behaviour and encouraging positive engagement.
For energy suppliers, this presents an opportunity to consider whether frontline teams have the skills needed to navigate increasingly complex conversations.
Because better customer outcomes depend not only on the solutions organisations offer, but on the quality of the conversations through which those solutions are delivered.
How DSW can help
DSW works with organisations to develop the skills, confidence and behaviours that enable people to perform effectively in challenging customer-facing roles.
Building on our experience supporting debt recovery teams within financial services, our Trust-Led Customer Conversations approach can be tailored to the needs of energy suppliers.
By combining behavioural insight, practical frameworks and real-world application, we help organisations strengthen frontline capability and support better customer outcomes.
If you’re reviewing how your organisation supports advisors managing financially sensitive conversations, we’d welcome the opportunity to explore your challenges and discuss how DSW could help.