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Another two energy suppliers have gone bust, bringing the total number of companies crashing out of the UK’s energy market to 21 in the last 10 weeks.
Neon Reef and Social Energy have both collapsed under the pressure of rocketing energy market prices, which have reached record highs in recent months amid a global gas supply crunch.
Neon supplied electricity to about 30,000 households, and Social Energy supplied energy to about another 5,500 customers, bringing the total number of customers in need of a new supplier to more than 2 million.
The suppliers ceased trading within days of the regulator warning that they would lose their licences if they failed to hand over cash collected from energy bills, which is used to support renewable energy projects.
Social Energy was one of five energy suppliers to miss its deadline for payment of £28,735 towards supporting small-scale renewable energy projects, such as rooftop solar panels, at the end of last month. Neon Reef missed a £349,149 payment for large-scale renewables, which was due at the end of August.
The energy regulator advised households left without a supplier to wait while a new energy company was appointed as their new supplier through Ofgem’s “safety net” process.
The market is expected to face scores more failures as energy market prices remain high moving into the winter months.
Energy company leaders and industry experts fear that all but the strongest six suppliers in the market may go bust in the months ahead, leaving suppliers that do not have the backing of major international energy groups, or deep-pocketed investors, to buckle under the weight of record energy costs.
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