By Nick Duffy
Energy suppliers Green and Avro, which supply a combined 835,000 homes, have both collapsed amid the energy crisis.
The regulator Ofgem confirmed on Wednesday that both companies will be ceasing to trade, one day after reports that Green was preparing for potential insolvency.
Avro supplies around 580,000 households, while Green supplies around 255,000 homes, the regulator says – a combined 2.9 per cent of domestic customers in the market.
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It continued: “Under Ofgem’s safety net, the energy supply of Avro Energy and Green Supplier Limited customers will continue and outstanding credit balances of domestic customers will be protected.
“Domestic customers will also be protected by the energy price cap when being switched to a new supplier.
“Customers of Avro Energy and Green Supplier Limited will be contacted by their new supplier, which will be chosen by Ofgem.”
Customers are urged to “wait until a new supplier has been appointed and you have been contacted by them in the following weeks”.
The firms are at least the fifth and sixth energy firms to collapse following the price surge, with many companies falling into difficulty as wholesale energy prices skyrocket – while consumer bills are protected from drastic price rises by the energy price cap.
While the Government is reportedly looking at ways to keep major energy providers afloat, through emergency loans or even potential nationalisation, Business Secretary Kwasi Kwarteng has indicated that smaller operators may be left to fail.
Green, which billed itself on climate-friendly credentials, has blamed the lack of Government support for smaller suppliers, unprecedented market conditions and regulatory failings, Sky News reports.
Neil Lawrence, director of retail at Ofgem, said: “Ofgem’s number one priority is to protect customers. We know this is a worrying time for many people and news of a supplier going out of business can be unsettling.
“I want to reassure customers of Avro Energy and Green Supplier Limited that they do not need to worry. Under our safety net we’ll make sure your energy supplies continue. If you have credit on your Avro Energy or Green Supplier Limited account this is protected and you will not lose the money that is owed to you.
“Ofgem will choose a new supplier for you and while we are doing this our advice is to wait until we appoint a new supplier and do not switch in the meantime. You can rely on your energy supply as normal. We will update you when we have chosen a new supplier, who will then get in touch about your tariff.
“Any customer worried about paying their energy bill should contact their supplier to access the range of support that is available.”
Green said in a statement: “Green fears that smaller energy suppliers are being left behind by the government, with rescue packages being put in place for larger suppliers and for private discussions to be held with the business secretary.
“There is a position in Government and Ofgem that smaller suppliers should be left to fail, despite the unprecedented increases in wholesale electricity and gas, the cost of failed suppliers being mutualised across the industry, and an outdated price cap methodology forcing smaller suppliers to sell at a loss.”
Inews