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    UK Energy Retailer Solarplicity Fails

Summary

New entrants into the challenging UK market have had a tough time of things lately, although one, Ovo, is raising its sights.

by: William Powell

Posted in:

Complimentary, Natural Gas & LNG News, Europe, Corporate, Mergers & Acquisitions, Financials, News By Country, United Kingdom

UK Energy Retailer Solarplicity Fails

Solarplicity Supply, a UK energy supplier with around 7,500 domestic customers and less than 500 business customers, has ceased to trade, the regulator Ofgem said August 14. It is the 13th such failure since January 2018 and the fifth this year. Ofgem said that different companies had failed for different reasons.

Under Ofgem’s safety net, the energy supply of Solarplicity’s customers will continue and prepayment meters can be topped up as normal. The outstanding credit balances of domestic customers will be protected.

Ofgem will choose a new supplier to take on all of Solarplicity’s customers. This supplier will contact these customers shortly after being appointed. Toto bought about 40,000 of the customers from Solartricity earlier this year.

Ofgem said it would find a supplier for Solarplicity's remaining 7,500 customers and energy supply would continue as normal until the new supplier notifies them of their new tariff.

This month Ofgem made the decision to confirm the provisional order issued to Solarplicity to pay outstanding money owed to feed-in tariff generators, but ended this action when it ceased trading. In February Ofgem also issued a provisional order on Solarplicity banning the energy supplier from taking on new customers and increasing vulnerable customers’ direct debits, owing to its poor switching process and customer service.

Another major energy retailer, SSE, one of the Big Six, has said it plans to sell that side of its business in 2020 and is in talks with Ovo, one of the newer entrants, about a sale. If a deal does go ahead, the BBC reported, SSE's 5.8mn domestic customers would be added to Ovo's 1.5mn, making it second only to Centrica's British Gas division, which has 12mn domestic accounts.

Centrica blamed the regulated tariff for its poor financial results this year and it was one of the reasons cited for SSE and Npower failing to agree on merger terms, despite regulatory approval, for their retail businesses last November.