Soaring wholesale gas prices have put some smaller energy suppliers at risk of collapse and left hard-pressed UK households facing even higher bills this winter.
The wholesale price of gas has risen by around 250% since the start of this year, surging by 70% since last month alone.
As smaller firms are less well-equipped for such extreme wholesale market volatility, many consumers are wondering whether their supplier will be next to go under.
Let’s take a look at what you should do in the event your energy provider goes bust.
Which energy firms have gone bust?
Since the start of August, a total of five UK energy suppliers have collapsed: HUB Energy, PFP Energy, MoneyPlus Energy, Utility Point and People’s Energy.
Which other energy firms are at risk of going bust?
Bulb Energy, the UK’s sixth-largest energy supplier with around 1.7 million customers, is the latest firm in the sector to get into financial trouble.
It is understood to have sought a government bailout to help it through its current problems.
What should I do if my energy supplier collapses?
If your energy provider goes bust, your household will not be cut off. Ofgem, the industry regulator, will ensure that your supply is not halted or interrupted.
Should your supplier cease trading, Ofgem recommends you do the following:
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Take a meter reading - but don’t switch suppliers yourself
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Wait for Ofgem to select a new supplier
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When your new supplier contacts you, ask them to put you on their cheapest tariff
However, you can also shop around for another supplier after Ofgem has appointed a new one for you. You won’t be charged any exit fees for doing so.
It’s important to remember that when you are switched to a new firm, you won’t necessarily be on the same deal (or a better one) than you were with your old supplier.
You’re therefore not obliged to accept a new supplier simply because Ofcom has chosen them. If you’re unhappy with the new deal, you’re free to find another.
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