Ofgem puts advisers on standby in case of large energy firm collapse

Ofgem has enlisted the expertise of a City advisory firm, it emerged on Thursday, to be on standby should the retail energy crisis worsen.

Sky News reported that Teneo has been retained by the energy regulator to step in as a special administrator, in case a larger retailer goes under.

In that event, it might not be possible for the company’s customers to be transferred to a competitor through the Supplier of Last Resort (SOLR) scheme.

It comes as rocketing wholesale prices for gas have caused five retailers, with an aggregate of 1.7 million customers, to go under in the last two weeks.

This week, Igloo, Enstroga and Symbio ceased to trade, adding to the failures of Avro Energy and Green Supplier last week.

Octopus Energy and Shell Energy Retail have taken on the customers of the latter two, respectively, under the SOLR system, with customers of the other three expected to be transferred to new suppliers in the next few days.

Other suppliers are expected to go over the brink as demand for gas ramps up in winter, with Bulb Energy - which supplies around 1.7 million residential customers - looking at funding options.

Ofgem also put five small retailers on notice last week for failing to pay their renewable energy levies which had fallen due, with Colorado Energy, Neon Reef and Whoop Energy told to pay up or risk their licence, alongside the since-collapsed Igloo and Symbio.