British Gas to take on the customers of failed energy suppliers PfP Energy and MoneyPlus Energy
After PfP Energy and MoneyPlus Energy became the latest energy suppliers to exit the market, Ofgem has designated British Gas to take on both of the failed companies 96,600 customers.
What happened?
Record high wholesale energy costs and renewable energy scheme payments combined to prove too much for both challenger energy suppliers.
Smaller suppliers are under increased pressure at the moment as they are most vulnerable to the soaring prices for gas and electricity. Their tendency to offer cheaper tariffs in an attempt to attract as many customers as possible as quickly as possible has put immense pressure on their bank balances.
High demand created by the easing of Covid-19 restrictions and a long winter has seen prices for gas skyrocket in recent months causing suppliers to make losses.
In combination with payment deadlines for numerous renewables and regulation payments past due (late payment deadlines are in October) PfP Energy and MoneyPlus Energy were forced to exit the market.
Concerns are growing that we could see more smaller energy suppliers forced to exit the market in October as there is no sign that wholesale prices are going to ease anytime soon.
Also read: Soaring gas prices and unreliable wind sees the UK turn to Coal to keep the power on
Another 96,000 customers for British Gas
Under the energy regulators Supplier of Last Resort (SoLR) scheme, the former customers of PfP and MoneyPlus will now be handed to British Gas and reassured that their energy supply will see no disruption and any credit payments owed will be honoured.
British Gas has benefited from the SoLR process as it has received well over 200,000 new customers as a result. British Gas acquired 18,000 new customers after Ofgem revoked Breeze Energy’s licence in 2019 and attained a further 112,000 customers following the collapse of Robin Hood Energy in 2020. Now it will receive an extra 94,000.
“When MoneyPlus Energy and PfP Energy stopped trading, our industry regulator Ofgem, asked British Gas to take over your energy supply.
Don’t worry, your services will continue as normal and there won’t be any interruption to your energy supply. We'll work with both companies to move your account over to us, so you won’t have to do anything,” said British Gas in a post on its website.
Also read: Worries grow over possible wave of small energy supplier failures in October
How does Ofgem choose a SoLR?
When an energy supplier leaves the market the regulator Ofgem takes over the process and assigns another energy licensee to take over responsibility for the failed companies’ customers.
“I am pleased to announce we have appointed British Gas for the customers of PfP Energy, and MoneyPlus Energy. Their energy supply will continue as normal, and customer credit balances will be honoured.
British Gas will be in contact with customers over the coming days with further information. Once the transfer has been completed, customers can shop around for a better deal if they wish to,” said Ofgem’s director of retail, Neil Lawrence.
When choosing the most suitable supplier to take on new customers, the regulator weighs up which bidding suppliers have the infrastructure in place to ensure they can fulfil their obligations with the minimum of fuss.
The process favours larger suppliers who already have the process and technology in place to ensure as smooth a transition as possible.
Smaller suppliers bidding in the SoLR process need to demonstrate that they have the resources to make any transition of customers as easy as possible.
Software such as Dyball’s CRM system can improve the speed and ease with which an energy supply company can serve its customers.
Also read: What are the Digital Tools an Energy Supplier should use to attract more customers?
Looking to enter the UK energy market? Dyball Associates team of energy market consultants can guide you through the steps to get qualified and attain your gas or electricity licence.
Whether you’re looking for electricity and gas systems or support on starting an energy supply company, Dyball Associates can help.
Further Reading
Ofgem to provide $450 million in funding to energy companies helping their customers go green
World EV Day 2021 - 5 Ways Energy Suppliers Can Help EV Owners
PfP Energy and MoneyPlus Energy cease trading
Dyball Associates are proud to help new supply businesses successfully launch in the UK market.
Through our energy market consultancy services, and the software we’ve developed, we’re supporting new UK electricity and gas suppliers to get set up and start supplying.
For more information on how to start and manage an energy company, get in touch with Dyball Associates today.
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