Posted on: 29/11/2016
Ofgem is taking steps to appoint a new supplier for the 160,000 domestic customers of GB Energy Supply which has ceased trading.
The regulator said it will “run a process to choose the supplier which will best protect the interests of GB Energy Supply customers”.
In a statement on its website, GB Energy Supply said: “Due to swift and significant increases in energy prices over recent months and, as a small supplier our inability to forward buy energy to allow us to access the best possible wholesale prices, means that the position of the business has become untenable.”
‘Price rises needed’
The collapse of the firm has made political intervention in the energy sector less likely, according to analysts at Credit Suisse.
It said new entrant suppliers were likely to be suffering pressures due to recent rises in wholesale prices and that increases for domestic customers would be needed.
The analysts estimate the Big Six need price rises of around 10% price rises in their standard variable electricity tariffs in first quarter of 2016 to maintain margins.
"Adverse headlines on customers being left temporarily without a supplier are likely to flag to government the importance of a profitable domestic energy supply industry,” they said.
.> Read Ofgem's announcement here