Bulb collapses in administration after failing to secure funding


The ulb has come under special administration, making it the largest energy company to collapse since the onset of the electricity crisis.

Bulb said: “We have decided to support Bulb’s placement in Special Administration, which means it will continue to operate with no disruption in service or supply to members. If you are a Bulb member, don’t worry as your energy supply is secure and all credit balances are protected.

Bulb is the first company to use the government’s special administrative process, which will see the government fund the continued operation of the business until a more permanent solution can be found. An official administrator will be appointed, who will then seek either a bailout deal, a restructuring, or a sale of the company.

Energy supplier Challenger Bulb was founded in 2015, but has quickly grown to become Britain’s seventh largest heating supplier, with 1.7 million customers. Bulb started looking for emergency investments in mid-September.

The rising cost of gas combined with the UK’s price caps on domestic tariffs means that operators now face huge losses as they provide energy to businesses at prices lower than they costs to produce. 25 suppliers have gone bankrupt so far this year, which means more than half of the market has collapsed.

Gas prices have started to fall in recent weeks, but delays in approving the Nord Stream 2 gas pipeline in Germany last week pushed prices further up last week and Bulb said this accelerated its collapse.

Bulb’s collapse nearly doubles the number of customers affected by the changes to around 4 million.

Ampule said in a blog post: “The growing energy crisis in the UK and around the world has worried investors who cannot move forward as wholesale prices are so high and price caps, designed to protect customers, mean currently suppliers are providing energy at a significant loss. “

Most energy companies that have collapsed have seen their customers transferred to a rival supplier in a government process known as the “supplier of last resort”. However, Bulb’s scale means that it is too big for this process – the large number of its customers could overwhelm other suppliers.

Instead, Bulb has been placed under special administration, which means that a company will be appointed to oversee the operations of the business and ensure an uninterrupted energy supply for customers.

A spokesperson for Prime Minister Boris Johnson said: ‘We have put in place robust powers and processes to ensure that customers do not experience disruption to their energy supply and that costs are minimized if a supplier exits the market. . “

Bulb said in a blog post: “We are expecting a high volume of calls today, so only call if it is an emergency, if you are in a vulnerable situation or if you are have trouble paying your bills.

“Thank you to our members and our team who continue to work so hard to create amazing products, provide exceptional customer service and bring renewable energy to our members around the world. “

Ofgem has been contacted for comment.

Source link

Comments are closed.