Another supplier bites the dust

[SirGalahad]

So it seems Bulb will go into special administration at a cost of millions to the HM Government. The whole collapse of the energy supply sector is due to weak regulation where anyone and his dog in a bedsit could set up an energy supplier.

Ofgem light touch regulation with less focus on risk management meant that these companies were encouraged to run at a loss to win market share.

Well now most have gone bust the whole regime will need to be changed. Politicians chasing election wins and lies got us here.

John Penrose, a Conservative backbench MP, who was one of the leading campaigners for a price cap before its introduction, admitted on Tuesday that politicians had got it wrong.

“We are where we are today due to mistakes made by parliament — it was the wrong type of price cap,” he told a podcast run by energy supplier Utilita.

 

[JohnD]

... anyone and his dog in a bedsit could set up an energy supplier....

By chance, I attempted to move to one of these backstreet suppliers earlier this year. They were so incompetent and unhelpful so I ended up cancelling the move.

Quite lucky, really, because, unsurprisingly, they were one of the first to collapse.

Conservatives and deregulation, eh?

 

[fillyboy]

anyone and his dog in a bedsit could set up an energy supplier.

That's right, quite a few local authorities are now energy suppliers, with huge debts underwritten by the taxpayer.

John Penrose, a Conservative backbench MP, who was one of the leading campaigners for a price cap before its introduction, admitted on Tuesday that politicians had got it wrong.

“We are where we are today due to mistakes made by parliament — it was the wrong type of price cap,” he told a podcast run by energy supplier Utilita.

How many types of price cap are there? I'm sure at the time consumers thought it a great idea to have more competition together with a price cap to stop the greedy buggers earning too much.
Global gas crisis caused by Russia, price of gas goes through the roof and the suppliers aren't allowed to pass on a price increase, of course they're going bust, apart from the local authority owned ones of course.

 

[Notch7]

By chance, I attempted to move to one of these backstreet suppliers earlier this year. They were so incompetent and unhelpful so I ended up cancelling the move

I’ve been with So Energy for 3 years, I’m keeping fingers crossed.

I did thoroughly research it before switching and checked out the company and directors - nothing dodgy showed up, some of the other small energy cos have foreign owners with bankruptcies behind them.

 

[fillyboy]

I did thoroughly research it before switching and checked out the company and directors - nothing dodgy showed up, some of the other small energy cos have foreign owners with bankruptcies behind them.

Barking and Dagenham Energy are a wholly owned subsidiary of Barking and Dagenham council so I suppose you could say they have a few 'foreign' owners. they've racked up £40 million in Govt grants over a five year period and have a customer base of 477 homes, that 477 includes an increase to their customer base of 95 between 2019 and 2021.

13 council-run energy firms have collectively lost nearly £75m in the past four years.

 

[motorbiking]

This isn't new though. While British Gas was privatised in the 80s, it wasn't until the late 90s that it was structurally broken up. It was a deliberate plan to allow entrants to the market to compete with the big 5 / 6. In fact anyone with less than 250,000 customers avoided most of the rules.

Maybe the consumers shouldn't be quite so protected by the tax payer and then people would consider - brand and stability a bit more.

 

[Notch7]

Maybe the consumers shouldn't be quite so protected by the tax payer and then people would consider - brand and stability a bit more

I think a secure energy market is a basic tenet of a Western democracy.

allowing consumers to be subjected to failure does not to me sound like a functioning political system.

 

[johnny2007]

I was with Green.
Before going bankrupt they took £173 through a third party so my credit card company won't honour the section 75.
On top of that they now sent a letter saying that I owe the administrators £296.
I was in credit when the imploded.
The sneaky [email protected]

 

[bernardgreen]

Maybe the consumers shouldn't be quite so protected by the tax payer and then people would consider - brand and stability a bit more

I agree with that, as with most products buying cheap comes with the increased risk of the product being withdrawn from the market.

 

[ellal]

Maybe the consumers shouldn't be quite so protected by the tax payer and then people would consider - brand and stability a bit more.

Maybe the consumer should be more concerned about their money being used for 'corporate welfare'!

 

[SirGalahad]

That's right, quite a few local authorities are now energy suppliers, with huge debts underwritten by the taxpayer.



How many types of price cap are there? I'm sure at the time consumers thought it a great idea to have more competition together with a price cap to stop the greedy buggers earning too much.
Global gas crisis caused by Russia, price of gas goes through the roof and the suppliers aren't allowed to pass on a price increase, of course they're going bust, apart from the local authority owned ones of course.

How many private suppliers have gone bust with the taxpayer funding the bill?

This was a failure of regulation - a light touch regulation with a focus on price and not risk mitigation with new entrants encouraged to enter the market. How many suppliers have gone bust in other countries to the same extent as the uk?

 

[SirGalahad]

This isn't new though. While British Gas was privatised in the 80s, it wasn't until the late 90s that it was structurally broken up. It was a deliberate plan to allow entrants to the market to compete with the big 5 / 6. In fact anyone with less than 250,000 customers avoided most of the rules.

Maybe the consumers shouldn't be quite so protected by the tax payer and then people would consider - brand and stability a bit more.

A failure of regulation is the fault of those that set and created the market environment - blaming consumers for acting on the asymmetric information is typical hogwash.

 

[SirGalahad]

I agree with that, as with most products buying cheap comes with the increased risk of the product being withdrawn from the market.

But isnt that competition and the free market?

Leading to inevitable market failure.

 

[bernardgreen]

Leading to inevitable market failure

Some of the individual traders will fail but that does not mean the market has to fail.

 

[Notch7]

2 more have gone bust

Entice Energy
Orbit Energy