Half a million households have a new supplier in the energy crunch: British Gas and EDF rescue customers from People’s Energy and Utility Point
- British Gas has taken on thousands of People’s Energy customers
- EDF has also been appointed to look after Utility Point’s customers
- The two suppliers collapsed amidst an industry crisis with rising wholesale costs
British Gas has taken on 350,000 customers from People’s Energy after the firm collapsed last week.
The mid-size supplier announced it would cease trading in a time where fears are mounting that more providers will go bust in the coming weeks as wholesale costs continue to rise and an energy crunch hits.
At the same time, Utility Point announced it would no longer be operating with EDF appointed to take on the company’s 220,000 domestic customers.
Both moves were organised by regulator Ofgem under its Supplier of Last Resort process.
British Gas takes on People’s Energy’s 350,000 domestic & 1,000 non-domestic customers
Outstanding credit balances, including money owed to both existing and former domestic customers of People’s Energy and Utility Point will be honoured.
Both People’s Energy and Utility Point customers were moved to their new suppliers over the weekend and will be contacted over the coming days about the changes.
If they wish to switch supplier they can shop around but are advised to wait until the transfer has been completed – although, the process has become more difficult given the current turmoil in the industry.
Customers will not be charged exit fees if they decide to switch to another supplier.
Neil Lawrence, Ofgem’s director of retail, said: ‘I am pleased to announce we have appointed British Gas as the new supplier for customers after People’s Energy entered insolvency.
‘We understand that this news may be unsettling for customers, however they do not need to worry.
‘Their energy supply will continue as normal, and all domestic customer credit balances held on their accounts will be protected. Your energy supply will not be interrupted.’
British Gas and EDF will be in touch with customers with direct debits to explain how to set up their account.
Big Six suppliers, British Gas and EDF, are taking on customers of folded energy providers
Customers are advised not to cancel their direct debits as the companies will aim to transfer these.
Meanwhile, Ofgem added the Supplier of Last Resort process will allow British Gas to recover the additional costs of taking on People’s Energy’s customers, where appropriate.
The Big Six supplier has said it will do everything it can to minimise those costs.
People’s Energy and Utility Point revealed they were collapsing last week, just a few days after PfP Energy, a supplier that had around 80,000 household customers and MoneyPlus Energy, which has around 9,000 household customers, announced they had folded.
The providers are expected to be the first of many to cease trading as a result of soaring wholesale gas prices, with smaller suppliers being far more susceptible to rising costs that they cannot absorb.
The crisis has been sparked by a number of factors but ultimately is due to the lack of natural gas being produced as well as an increase in demand.
As a result, wholesale prices for gas are up 250 per cent since January. Costs have also soared 70 per cent since August.
It is thought that by the end of the year there will be just 10 suppliers left trading – down from 55 at the start of the year.