ENERGY COMPANIES GOING BUST

Tried ringing Energy Company as last invoice stated was in credit of 75.80 but they never release credit until March following year...this is fraud....

Two more companies have folded, Green & Avro. We are/were with Avro and yesterday when I checked our a/c was in credit of over £100, their website is now saying they have ceased trading.

toscalily I heard the topic discussed on tv this morning. The advice was that if your provider goes bust you will be transferred to another conpany and any credit or debt will go to your new account.

Riverwalk

The Government should not bail out these failing companies.

I can't find the definite answer but there are around 85 energy suppliers in the UK - a ridiculous number as these companies don't actually lay the pipes, dig for oil, run the power stations etc.

Many of the ones going to the wall would seem to be fly-by-night outfits anyway - offering low rates when the going is good but having no business plan/finance to cope when world energy prices rise.

Does anyone know the criteria that has to be met to start an energy supply company?

Actually, I agree with you.
The UK doesn’t need so many to allow for competition, they seem to have mushroomed recently.

toscalily

Two more companies have folded, Green & Avro. We are/were with Avro and yesterday when I checked our a/c was in credit of over £100, their website is now saying they have ceased trading.

Avro customer here too. I can’t get into my account to check amount owing or average annual usage.
I know that we will be contacted by Ofgem in the next few weeks, but do we carry on paying the monthly direct debit?

I was with Utility Point but decided to switch to another provider as my tariff had ended and the new quote was a lot higher even though I was in credit with them.

The switch went ahead on September 17th. On September 18th Utility Point ceased trading. I now have no idea if I will ever get back the money owed to me by Utility Point as technically I was no longer a customer when they went bust.

Some info here that might be useful

www.ofgem.gov.uk/information-consumers/energy-advice-households/what-happens-if-your-energy-supplier-goes-bust

Has there actually been any suggestion of the Government bailing out the failing companies?

As I understand it, the negotiations are about funding for the large companies who will have to act as Supplier of Last Resort (SoLR) - in other words, those companies which be asked to take on the customers of the failed suppliers immediately so that they continue to receive their gas/electricity.

If I remember rightly, even before the recent huge wholesale price increases, very few SoLR honoured the cheap deals that these transferred customers previously had.
Now, with the huge rise in wholesale fuel prices, to do so would probably put them out of business too!

I presume that this is where the Government will step in with some financial backing. If they don't, I suspect that on this occasion the large companies might actually refuse to act as SoLR, potentially leaving customers of failed companies without a supply

If you do find yourself in the unfortunate position of being with a supplier that ceases trading , there are one or two things to bear in mind:

- It's best not to try to change supplier until your transfer to the SoLR is complete - doing so can complicate matters.

-As soon as the transfer is completed, look for cheaper deals.

-If you possibly can, arm yourself with records of your meter readings in case there is a dispute over either credit or debt. (Previous statements, either paper or downloaded, and a photo of the actual meter reading are well worth having!

-Leave your Direct Debit in place until it is replaced by one for the SoLR

- You should, eventually, get back any credit that you had with your old supplier, but it might take quite some time.

Some of the problems for the smaller companies was that their business model did not include “ hedging” ie paying a type of insurance against high prices for the gas they buy. The so called big six all pay for this so are not as affected by the recent increases in the cost of gas. The smaller companies can only offer consumers lower prices by cutting corners like this.

I think 85 energy suppliers is an awful lot and not sustainable long term. I was with Sainsbury’s energy when they ceased trading and it was a smooth transition to British Gas, I didn’t have to do anything and my credit balance appeared on my initial statement. I ended up staying with BG as I decided only to consider these six big companies when doing comparisons as I no longer trusted the cheap suppliers. I have been able to negotiate some good fixed price deals with BG but I suspect that in November at my year end, prices will go up drastically.

Thankyou granny wannynanny for your helpful post.I am £355 in credit with Avro Energy and requested a refund of £275 last Sunday ,which now won't happen .After reading the ofgem details I now know that I will eventually get the refund. Tonight I cancelled the direct debit ,they are not getting a further £66 of me !!

I pay bills quarterly. Just put money away monthly to pay it. No arguments about monthly payments, no huge balances with utility companies and far fewer problems and far fewer problems all round.

Small companies operate on a wing and prayer, hoping to keep prices down by ducking and diving. They are mainly buying on the 'spot' market, ie whatever price gas can be bought day to day and hope that with 'good' days and 'bad' days, it will even out at the end of the year. I would never ever consider going with the small companies. Their business plans are far too dicy. As we have seen over the last month. When prices are rising consistently, their are up the creek without a paddle.

Bigger companies have long term contracts for gas supplies, so shouldn't be so severely affected by variations in gas prices. However gas contracts are constantly being negotiated, and even if you have a contract, if the person selling gas suddenly stops supplying it or reduces supply (like the Russians), they too are forced onto the spot market.

I always thought the break-up and privitisation of public utilities like British Gas and the Electricity Council was a bad idea.

Although the UK now imports about half of the gas it uses, it sources very little from Russia. The major supplier is Norway.

The UK has been very badly hit by gas prices because:

a) 85% of homes are heated by gas - one of Europe's biggest users of natural gas.

b) The UK has very low gas reserves compared with other European countries.

MOnica
This spot market was something I was totally unaware of ( why would I be?) but it appears the Asian market are outbidding the west.

Almost all commodities are traded on spot markets.

Growstuff
It’s not just us with low gas reserves.

www.dw.com/en/opinion-germany-is-ignoring-gazproms-attempted-blackmail/a-59228004

I didn't say we are the only country affected, but we are one of the worst affected because we use so much gas and have so little in store (much less than Germany). As household consumers, we are being affected as a result of the organisation of the retail market.

theconversation.com/gas-price-spike-how-uk-government-failures-made-a-global-crisis-worse-168324

this is not about failing companies. None of those in charge thought that prices would escalate so quickly, that energy would be restricted by other countries. For years we have been told to shop around for a good deal - now we are just hoping that any new firm stays around long enough for us to get the energy we want. It was ok for the government to bail out the banks which still pay massive bonuses to staff , yet to ensure we have energy it is not ok?

Sorry, but if those in charge didn't realise that gas prices would rise so quickly, they're idiots. Gas prices have been rising since early summer and any half-decent commodities analyst should have known the political/global context would mean that they would rise further. The UK had almost no buffer and has been hit badly. No doubt the owners of the cowboy utility companies made a quick buck and have left their customers with higher prices.

kjmpde I'm sure you will get your energy - but you're going to have to pay increased prices.

In spite of all the incentives I decided to stay with EDF and now think it was a good choice.
I am another one who thinks that all utilities should have stayed in government hands and should have stayed nationalised.
Selling off to foreign concerns was a very bad move.
We are reaping the results now.

Companies take a commercial risk and all hedge and buy spot in varying degrees, the problem is that when supplies are short forward buying prices increase, companies without large reserves are going bust.
Nobody wins in this situation, creditors don’t get paid, taxes don’t get paid, staff loose their jobs, consumers have to pay more. The price cap is due to be set in October, there is no guarantee that that will be enough to keep prices down without further government intervention.

I am sorry, kjmpde, but everything you mention was completely foreseeable and clearly signposted.

The dangers of our dependence on foreign suppliers like Russia has been a concern for 30 years or more.

Germanshepherdsmum, I really hate using direct debits. However, I do use one for gas - to get the lowest charge.

I use it to my advantage (not theirs) - by paying just £5 per month direct debit (that covers the standing charge) and sending monthly meter readings.

They (British Gas Evolve) email, within a day, with my usage and amount owed. I pay that immediately, online - so they can't ever increase my direct debit!

This month's 40p bill:

Your monthly statement is ready to view using your online account.

Your account balance is currently £ 0.40 in debit and your next payment of £5.00 will be taken on 4th October 2021.

As you pay by Direct Debit you don't need to do anything - this statement is for your information only.

£5? I assume you don't use gas for heating or cooking.