What should I do if my energy supplier goes bankrupt? – .

What should I do if my energy supplier goes bankrupt? – .

Another 830,000 customers were left without a supplier after the collapse of Avro Energy and Green Energy yesterday.

They are the last suppliers to go bankrupt as the energy sector continues to suffer from rising wholesale prices.

The crisis was triggered by the lack of natural gas production as well as by an increase in demand.

As a result, seven suppliers have gone bankrupt in the past five weeks because they did not purchase enough wholesale power to continue supplying their customers at the often low rates promised.

Seven suppliers have gone bankrupt in the past five weeks, thanks to wholesale costs

Many consumers are now worried that their supplier will go out of business, with some experts predicting that there will be only 10 suppliers left by the end of the year.

Below, This is Money reveals what to do if your supplier goes bankrupt.

Stay in place ?

Those with a collapsed supplier are urged by Ofgem to stay put and not to withdraw.

This is because consumers might have a harder time getting the money they are owed if they change before it happens.

Instead, the regulator will find consumers a new supplier through the supplier of last resort system, a process that can sometimes take a few weeks.

For example, Utility Point customers, who learned last week that the company had collapsed, are now informed that they will automatically be transferred to EDF.

Customers are advised to wait until their new provider contacts them as they will explain to them what will happen with your account.

Do not contact your new supplier unless you have not heard from them within two weeks.

While you are waiting for news from your new supplier, if you have an online account, it is a good idea to log in, check your balance, and download your invoices.

It is also useful to take a meter reading, write down your account balance, and keep your old bills.

Do not cancel the direct debit until your new account with the new supplier is opened.

If your account is in credit, your money is protected and your new provider should tell you how you will be reimbursed.

For those with a collapsed supplier, Ofgem advises them to stay put

For those with a collapsed supplier, Ofgem advises them to stay put

However, if you are a small business customer, while Ofgem will try to choose a provider who can repay all or part of your credit, this is not guaranteed.

If you paid a debt to your old supplier, your customers will still have to pay it off.

“Deemed” contracts

When customers are transferred to a new supplier, they will be put on a special “deemed” contract which is a contract they did not choose and not the fixed deal they may have had before.

Reputable contracts may be more expensive because the supplier takes more risk, for example, he may have to purchase additional energy in bulk at short notice for new customers.

Therefore, they charge more to compensate. As wholesale prices increase, these contracts are likely to be costly.

However, Ofgem said it will try to get the best possible deal for customers.

While customers may switch suppliers once they have moved to a new supplier, in today’s climate it can be difficult to find a fixed offer that is good value for money.

In fact, it may be worth switching to a default tariff, which, while generally considered more expensive, is capped at £ 1,277 per year as of October 1, thanks to Ofgem’s energy price cap. .

An Ofgem spokesperson said: “We know that the current situation with high wholesale energy prices is putting pressure on customers and energy companies. It is a global problem.

“We have systems and processes in place to ensure that customer needs are always met.

“For customers who are with energy companies that can no longer trade, a new supplier will be appointed.

“Ofgem is working closely with the government to manage the wider implications of the global increase in gas prices. “

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