Blog Post

Scottish Power takes on Yorkshire Energy’s customers via SoLR process

Richard Simmonds • Dec 08, 2020

After Yorkshire Energy became the latest energy supplier to exit the market, Ofgem designated Scottish Power to take on the failed companies 74,000 customers.

What happened?

Yorkshire Energy went under as pressures created by the Covid-19 pandemic proved too much.

Rising bad debts among consumers and a failure to raise new investment forced the company to close its doors last week.

The supplier became the latest to go under following the collapse of Tonik Energy earlier in October.

Unlike that supplier who went under due to being unable to pay its Renewables Obligations, Yorkshire Energy prided itself on making its payments on time. In their case a combination of market challenges, increased competition and the Covid-19 pandemic caused their demise.

Also read: Yorkshire Energy latest energy supplier to cease trading as Covid-19 pressures mount

Another 74,000 customers for Scottish Power

Under Ofgem’s Supplier of Last Resort (SoLR) scheme, those customers will now be handed over to Scottish Power and reassured that their energy supply will see no disruption.

The move sees Scottish Power expand their customer base yet again after it received Tonik Energy’s 130,000 domestic customers following that suppliers collapse.

Scottish Power will also take on all outstanding credit balances, including any money owed to both current and former domestic customers.

Andrew Ward, Scottish Power CEO, UK Retail added: “We would like to extend a warm welcome to our new customers. You’re joining a safe and stable integrated energy company with decades of experience, focused on delivering net zero through a green recovery.

“We understand that this can be a stressful time, but please be reassured we are working tirelessly to make this transition as smooth as possible for you. For the moment, we would just ask that you sit tight, we will be in touch soon about next steps.”

Also read: Scottish Power takes on Tonik Energy’s customers

How does Ofgem choose a SoLR?

When an energy supplier leaves the market the energy regulator takes over the process and assigns another energy licensee to take over responsibility for the failed company’s consumers. This ensures a continuing supply of electricity and gas in the event of a supplier’s collapse.

Philippa Pickford, Ofgem’s director of retail, added: “I am pleased to announce we have appointed Scottish Power for the customers of Yorkshire Energy. Their energy supply will continue as normal and domestic customer credit balances will be honoured.

“Scottish Power 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.”

Ofgem considers which bidding licensees are the most suitable to take on new consumers and be able to fulfil its other obligations without issue. If no energy supplier applies to be a SoLR, Ofgem has the power to appoint a supplier without its consent.

Yorkshire Energy’s customers were transferred to Scottish Power on December 6^th.

Also read: What is a Supplier of Last Resort?