29,000 households are awaiting a new supplier, since Manchester-based, Eversmart Energy fell bust. This comes not too long after Solarplicity, which ceased trading just last month, left a further 7,500 households seeking an alternative electricity supplier.
Whilst Ofgem seek the new suppliers for the households, electricity and gas will remain to be supplied to all. Customers are advised not to switch provider until a new supplier has been allocated and has been in touch, regarding a new tariff.
Ofgem’s director for future retail markets, Philippa Pickford, reassured customers that through their safety net, they will ensure ‘’energy supplies are secure and domestic customers’ credit balances are protected’’.
The green energy provider have hit the press before, but for the wrong reasons. When they launched a tariff requiring customers to pay a whole year’s energy up-front, they were quickly accused of using the tariff unethically, to extract more money from its customers. Furthermore, the Energy Ombudsman reported receiving an increasing amount of complaints about Eversmart over the past year. So far, four times as many complaints have been received this year, compared to what was received for the whole of last year. The main complaints have been regarding billing and switching issues. Just last year, the company were given a notice from the regulator, due to failing to pay into a fund, when they did not source enough renewable energy under the Renewable Obligation scheme.
This is quite an alarming piece of news for experts, who have called for Ofgem to take charge and reform the energy market, since small suppliers keep on collapsing. Brilliant Energy, Extra Energy, Spark Energy, National Gas and Power, Gen4u and One Select are among a few of the other collapsed energy suppliers. The launch of tougher rules for new entrant energy suppliers, earlier this year, has not helped this situation.
It's suggested that regular health checks on existing energy suppliers and on-going assessments should be engaged in, to ensure each can finance its operations without being detrimental to its customer service.
Gillian Guy, Chief Executive of Citizens Advice expressed the concern that this has left behind ‘’at least £172million in unpaid costs, which will be picked up through higher bills for other consumers’’. ‘’Customers may have high credit balances. When a supplier goes bust, customer credit balances are protected. But all of us will eventually pay for honouring them through increased bills’’.
Once a new supplier has been assigned, following a customer’s provider ceasing trading, they are encouraged to use price comparison sites to see if they can save money by switching providers. Advice is also given for households to switch to fixed energy tariffs rather than use standard variable tariffs which are traditionally more expensive. From this switch alone, suggestions are that around £246 will be saved.