Spark Energy has gone out of business. Its 290,000 customers will now be entering Ofgem’s ‘supplier of last resort’ process, and Ovo Energy told the BBC that it had put forward proposals to Ofgem to acquire the business.
The company follows Extra Energy, Future Energy, National Gas and Power, Iresa Energy, Gen4U and Usio Energy out of business.
Doug Stewart of Green Energy UK said: “We have been warning of the consequences of unsustainable business models and rock bottom prices for over three years. We warned of the consequences of taking customer money up front, akin to a Ponzi scheme. In the space of two days, over 750,000 customers have been affected by these suppliers going bust. Who is going to absorb them? And what is more, compliant suppliers will have to pay for the ROC shortfall the FIT shortfall AND the customer deposits. It’s time we stopped errant suppliers from people playing fast and loose with customer money and passing on their costs to the rest of the industry. Ofgem has finally decided to do something about stress testing but the terms ‘stable door’ and ‘horse has bolted’ spring to mind.”
On Wednesday, Stewart welcomed Ofgem’s proposed new stress tests for financial and customer service. Saying they were “essential,” he added, “This can’t happen soon enough given the number of suppliers that have failed in the interim period and the current shortfall in supplier payments into the FIT levelisation fund and the ROC buy-out fund”.
Read Doug Stewart’s and others earlier comments: Energy suppliers: do they need more oversight?