Another small energy supplier – Extra Energy – has ceased trading, making it the sixth supplier to go out of business since the start of the year.
The company had attracted just 108,000 domestic and 21,000 business customers. Energy regulator Ofgem said Extra customers’ supplies will continue as normal and any credit balances will be protected.
A new supplier will be appointed by Ofgem and customers will be transferred directly. “If you are an Extra Energy customer, under our safety net, we will make sure your energy supplies are secure,” said Philippa Pickford of Ofgem.
“Ofgem will now choose a new supplier and ensure you get the best deal possible. Whilst we’re doing this our advice is to ‘sit tight’ and don’t switch.
“You can continue to rely on your energy supply as normal. We will update you when we have chosen a new supplier who will then get in touch about your new tariff.”
Extra Energy blamed the government’s recent introduction of a price cap on energy bills for “making the market unviable”.
“We have tried to restructure, merge and reduce costs in order to ensure the viability of our UK business,” said chief executive Nick Read.
“However, in light of the substantial UK regulatory change with the introduction of the price cap, we see no long term investment opportunity in the UK market.”
The Energy Ombudsman said it had opened investigations into 1,160 complaints about Extra Energy over the past 12 months.
Chief executive Matthew Vickers said: “We are keen to work closely with whichever supplier is chosen to take on Extra Energy’s customers to help ensure a smooth transition for consumers, as we did with Octopus Energy following the collapse of Iresa in July.”
He echoed Ofgem’s advice to consumers to “sit tight”, take a meter reading and not switch to another supplier.
The other suppliers to cease trading this year are:
- Future Energy (January)
- National Gas and Power (July)
- Iresa (July)
- Gen4U (September)
- Usio Energy (October)
Since the gas and electricity supply markets were opened up to competition, the industry has attracted dozens of new entrants.
As of June this year there were 73 suppliers, including 67 smaller operators. Ofgem said 13 new suppliers entered the market in the year to June.
Of customers switching provider, many have chosen small energy firms over the “big six”, who have consistently lost consumers.