at least four small uk energy firms could go bust by next week
Energy industry sources say that at least four small UK energy companies are expected to go bust by next week due to soaring wholesale gas prices. four firms are known to have asked larger UK gas providers to bid to take over the supply to one million customers.
Fortunately, for those one million affected, by industry rules the supply to each customer will be unaffected meaning they can carry on as usual. any credit due to the customers would also have to be paid out to them where applicable which is why finding a gas provider to take over the area is providing more challenging. By regulations, if a company takes over the gas supply in one area, they are also responsible for paying out customers' credit where it's applicable. This means that it's a really big disincentive for companies taking on new customers.
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the UK's Business Secretary, Kwasi Kwarteng tweeted "Some energy companies are facing pressure. Ofgem has robust measures in place to ensure that customers do not need to worry, their needs are met, and their gas and electricity supply will continue uninterrupted if a supplier fails."
The government has repeatedly stated that the UK won't be affected by supply emergencies. the Department for Business Energy & Industrial Strategy put on its website "While we are not complacent, we do not expect supply emergencies this winter."
Kwasi Kwarteng followed on to say that "Our largest single source of gas is from domestic production, and the vast majority of imports come from reliable suppliers such as Norway. However, our exposure to volatile global gas prices underscores the importance of our plan to build a strong, home-grown renewable energy sector to further reduce our reliance on fossil fuels."
This week alone, the industry has seen the shut down of Edinburgh's People's Energy who provided energy to over 360,000 customers as well as Dorset's Utility Point who had over 220,000 customers. At the start of 2021, the UK had 70 energy suppliers, some of those in the industry are suggesting that there could be fewer than 10 providers by the end of the year.
So what happens if your energy supplier shuts?