Four more UK energy suppliers collapse amid rising gas prices | energy industry

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Four more energy suppliers went bankrupt in a single day as historic gas market hikes continue to penetrate the UK energy market amid fresh concerns that Russia may curb gas supplies to Europe.

The collapse of four small energy suppliers on Tuesday will leave about 24,000 households in need of a new supplier, and bring the total number of collapsed energy companies to 17 since the beginning of September, affecting more than two million companies, the energy regulator, Ofgem, said. families.

The wave of failures came in the wake of the global energy market skyrocketing prices due to the sudden rise in gas demand as economies began to ignore the restrictions related to the Covid-19 epidemic. Gas markets have hit record levels in recent weeks, leading to one of the biggest increases in household energy bills and fears of a cost-of-living crisis this winter.

Of the four victims in the UK, Zebra Power had the largest customer base, powering 14,800 households. Omni Energy provided around 6,000 local prepaid customers, while AmpowerUK had about 600 customers in the UK and provided an additional 2,000 homes overseas. MA Energy had about 300 overseas customers.

More energy suppliers are expected to collapse in the coming months as gas markets remain at near record levels and suppliers are forced to incur higher costs without raising their tariffs above the regulator’s energy price ceiling.

The Citizens’ Consumer Charity said struggling households would eventually pay the price “with uncertainty, inconvenience and ultimately high bills” as suppliers “continue to fall like dominoes”.

Gillian Cooper, Head of Energy at Citizens Advice, said: “Last week Ofgem outlined how it intends to ‘raise’ supplier standards and improve their resilience in the short term. This is a positive step, but it is clear that existing rules and their enforcement has not been enough.”

Cooper added: “In the long term, Ofgem will need to do more to make sure companies are financially sound and provide good customer service. This should include protecting people from the loyalty penalty, which before the cap was allowing companies to take advantage of those who didn’t change Or they couldn’t change.”

The energy regulator laid out plans for a “bold action” last week to track changes to the price cap, which protects about 15 million households from unfair energy bills, after mounting calls from suppliers to make the cap more flexible so that market increases on households can be bypassed sooner.

The price cap reform emerged amid deep concerns that gas prices, which have risen more than three times from this time last year, may resume their rally as temperatures cool across Europe and Russia curtails gas exports to Europe.

Gas flows from Russia’s state-owned giant Gazprom, which supplies about a third of European gas, fell sharply over the weekend, and on Tuesday the company refused to provide additional gas supplies to Europe from January, when demand is often at its highest for for Europe. winter.

The slowdown in gas exports has reignited concerns about energy suppliers in the winter despite the direct order from Russian President Vladimir Putin for Gazprom to focus on filling its European gas storage facilities from November 8, when Russia’s domestic storage should be filled.

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Russia’s decision not to open the gas taps to allow additional supplies to Europe from January also defies calls from the global energy watchdog, the International Energy Agency, which said last month that Russia should help ease market prices by increasing gas exports to Europe this winter. .

Moscow has denied that it is withholding gas supplies from Europe via its pipelines through Ukraine and Poland to pressure German regulators to agree to gas shipments via the new Nord Stream 2 pipeline across the Baltic Sea to Germany.

But its decision to send only contract volumes despite strong demand for additional gas supplies is likely to raise gas market prices across Europe, helping Russia impose higher duties on its hydrocarbon exports.

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