Avro Energy and Green crash out of energy market
The two energy suppliers have both collapsed after a surge in wholesale gas and electricity prices that is proving catastrophic for the energy industry.
Avro Energy supplied gas and electricity to about 580,000 domestic customers. Green supplied gas and electricity to about 255,000 domestic customers and a small number of non-domestic customers. It was reported yesterday that Green was in talks with insolvency experts.
According to Ofgem, together the suppliers represent a share of 2.9% of domestic customers in the market – Avro Energy 2% and Green 0.9%.
Under Ofgem’s safety net, the energy supply of the customers of both companies will continue and outstanding credit balances of domestic customers will be protected. Domestic customers will also be protected by the energy price cap when being switched to a new supplier.
Ofgem will choose a new supplier for the customers of both firms. Customers are advised to wait for contact from the new supplier before looking to switch to another energy supplier.
Neil Lawrence, director of retail at Ofgem, said: “Ofgem’s number one priority is to protect customers. We know this is a worrying time for many people and news of a supplier going out of business can be unsettling.
“I want to reassure customers of Avro Energy and Green Supplier Limited (‘Green.’) that they do not need to worry. Under our safety net we’ll make sure your energy supplies continue. If you have credit on your Avro Energy or Green Supplier Limited account this is protected and you will not lose the money that is owed to you.”
Yesterday Ofgem’s chief executive Jonathan Brearley warned the government that more firms could go bust. Speaking to MPs at a Business, Energy and Industrial Strategy Select Committee (BEIS) hearing, Brearley said the change in the gas price was “not something we’ve seen before at this pace”.
Justina Miltienyte, energy policy expert at Uswitch.com, said: “This is a double blow for the energy industry and will cause further worry for consumers. Avro and Green’s simultaneous exits from the market come after People’s Energy and Utility Point ceased trading last week. Nine energy suppliers have been forced out this year so far and it’s likely that more may follow.
“Soaring wholesale prices are making conditions difficult for all suppliers, but challenger brands in particular are struggling to make ends meet. Affected customers will be moved onto new suppliers appointed by Ofgem, but for now they should sit tight and wait until their account is transferred to the new provider before trying to switch.
“We recommend that Avro and Green customers make a note of their meter readings now, and again when contacted by their new supplier, to ensure bills are accurate.”