Energy Crisis: Two More Suppliers Collapse As Pipeline Delay Causes Gas Prices to Soar Again

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Two other UK energy companies collapsed, a pipeline delay in Europe adding to wholesale price pressures that created a crisis in the industry.

Regulator Ofgem said Neon Reef, which has around 30,000 domestic electricity customers, and Social Energy Supply, which supplies around 5,500 households, have ceased operations.

This brings to 21 the number of UK suppliers who have gone bankrupt since early September after soaring gas purchase prices on the wholesale market.

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Why the energy price cap ‘fails’ in the UK

More than two million customers have been affected.

The boom in the gas market has forced companies, some of which have not “hedged” or insured against such fluctuations, to buy energy at high levels while being under contract to sell it at high levels. cheaper to their customers.

Prices skyrocketed across Europe again on Tuesday as Germany’s energy regulator suspended the approval process for Nord Stream 2, a major new gas pipeline bringing Russian gas to Europe.

The project has met stiff opposition from the United States, which says it will make Europe too dependent on Russian gas and set aside Ukraine, which has traditionally been the main route for the project. .

In the UK, the price of gas for overnight delivery has risen by more than 10% to 225 pence per therm, several times above the range of around 50 pence where it has generally traded in recent years, although ‘less than Recording level 355p reached in early October.

Customers of the collapsed companies were told by Ofgem that their supplies would continue and, if they were in credit, the money they had put into their accounts would be protected.

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Energy supplier crisis must never happen again – owner of British Gas

They will have a new supplier chosen for them and they are advised not to try to change until then.

These customers will also be protected by the energy price cap – although that cap was raised in October and households could end up paying more if they were given lower tariffs with companies that went bankrupt.

Neil Lawrence, Director of Retail at Ofgem, said: “Ofgem’s number one priority is protecting customers.

“We know these are worrying times for many people and the news that a supplier is shutting down can be troubling.

“I want to reassure affected customers that they don’t have to worry: under our safety net we will ensure that your energy supply continues. ”

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