ENERGY companies in the UK face an uncertain transition into winter, as many have folded already amid the price crisis.
Wholesale gas prices have risen 250% since the beginning of the year, leaving a strain on the UK energy industry.
Currently suppliers are forking out for the hiked costs as the government’s energy price cap limits what they can pass on to customers.
But we have previously explained how the cap is set to rise by £139 a year, from £1,138 to £1,277 in just over a week’s time.
Consumer energy bills could also rise even further as the government hasn’t ruled out raising the price cap beyond this too.
The rocketing gas prices have even forced carbon dioxide (CO2) processing plants to shut, and supermarket meat and frozen food supplies could be hit as well.
But the impact on the energy firms directly could also be devastating.
The Lanchashire post reports that as many as 60 energy companies could collapse even before the year is over.
That would mean there would only be 10 suppliers remaining.
Earlier in the week, comparison giant, Compare the Market, had to remove its switching service as it felt it couldn’t provide customers with enough quality choice tariffs to decide between.
The service freeze is due to only be temporary, but as of yet it still remains offline.
Meanwhile, hundreds of thousands of Brits have been left in the dark already as their providers collapse.
Utility Point and People’s Energy have already folded, along with a host of other small providers who’ve met the same unfortunate fate.
But more energy firms could go bust over the coming weeks according to the Business Secretary yesterday.
Bulb, the UK’s sixth largest provider, is among firms seeking a government bailout.
But it’s thought many more smaller firms could collapse in the coming days as firms crumble under the weight of surging wholesale costs.
Which energy companies have gone bust this year?
- HUB Energy (Bust on August 9)
- PFP Energy (Bust on September 7)
- MoneyPlus Energy (Bust on September 7)
- Utility Point (Bust on September 14)
- People’s Energy (Bust on September 14)
Which energy companies are at risk of going bust this year?
What happens if my energy provider goes bust?
If your supplier folds, your energy won’t be cut off, so there’s no need to panic.
In the meantime, Ofgem will arrange an interim supplier so you won’t have to go without.
Customers affected will be contacted by the new supplier, which will be chosen by Ofgem.
With the recent fall of People’s Energy, for example, Ofgem has appointed British Gas to take on supplying the provider’s over 350,000 customers.
The new firm won’t have to honour the deal you were on with your previous provider, but any credit on your account will be protected.
Experts like Martin Lewis’ MoneySavingExpert are advising customers not to rush to switch though, and instead “simply sit tight and wait to be contacted by a new supplier”.
But it is recommended that you take a meter reading ready for when your new supplier contacts you.
Other charities also recommend keeping old energy bills and waiting until your new supplier is appointed before cancelling any direct debits.
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