UK’s seventh biggest energy firm Bulb enters Special Administration, becoming the largest firm to go bust. The energy crisis has now caused more than 22 firms to cease trading, affecting almost 4 million customers across the UK in total.
- What’s happened to Bulb?
- What is Special Administration?
- Bulb customers: what does this mean for me?
- Need help?
1. What’s happened to Bulb?
Bulb has entered special administration on Wednesday, 24th Nov which will allow the firm to keep trading until a new buyer takes over its 1.7 million customers.
In an open letter to the Business Secretary, Ofgem explained that seeking to place Bulb in Special administration is “essential in the circumstances” as Supplier of Last Resort (SoLR) will not be “feasible or in the best interests of consumers”.
The appointed special administrator, Teneo will be working alongside Bulb’s existing management and stakeholders to keep the business running. The government has allocated about £1.7 billion to support Bulb, but Teneo estimates it will cost £2.1 billion to keep the firm trading until end of April next year.
You can read their statement here.
2. What is Special Administration?
The Special Administration Regime (SAR) is designed as a last resort to protect consumers and ensure continued energy supply when a big provider fails, especially when services may be interrupted under normal insolvency processes, eg. Supplier of Last Resort (SoLR). It was established in law in 2011, and this is the first time it’s ever been employed.
Other than energy suppliers, this procedure can also be used for other essential services such as water, sewerage, transport, education, postal etc.
3. Bulb customers: what does this mean for me?
If you are a Bulb customer, don’t worry – Bulb will be operating as usual, and customers will not have to take any action. You can still join or leave Bulb, and refer customers to receive referral credits as usual. There are no changes to energy supply, tariffs and billing periods will stay the same.
Energy prices are protected by the energy price cap, which will be renewed in February 2022 and any changes will be announced on 1 April.
4. Need help?
If you are moving house soon or have recently moved, it is important that you choose the right energy supplier for your household. For more information on the energy crisis, and advice on switching energy suppliers, contact us at +44(0)8003688551 or email us at [email protected]. Our connection experts are more than happy to help.