Utility Point and People’s Energy goes bust: Over half a million customers are told to sit tight by Ofgem as it finds households’ new supplier
- Both Utility Point and People’s Energy have announced they have gone bust
- Over half a million customers are told to wait whilst a new supplier is found
- The pair follow PfP Energy and MoneyPlus Energy which both folded last week
Two energy suppliers, Utility Point and People’s Energy, have announced today that they are ceasing to trade, affecting over half a million customers.
Customers of the two firms will be contacted by their new supplier, which will be chosen by Ofgem.
Utility Point currently supplies gas and electricity to around 220,000 domestic customers whilst People’s Energy supplies energy to around 350,000 domestic customers and around 1,000 non-domestic customers.
Utility Point and People’s Energy are ceasing to trade, affecting over half a million customers
This is the second time this month that two energy suppliers have announced they have gone bust.
PfP Energy, a supplier that had around 80,000 household customers and challenger provider, MoneyPlus Energy, which has around 9,000 household customers, announced they had folded last week.
British Gas has since announced it will take over supply for the customers of both companies.
Customers with Utility Point and People’s Energy are now advised to sit tight as they will continue receive a supply under Ofgem’s safety net.
Outstanding credit balances of domestic customers will also be protected.
The regulator advised customers they should not switch to another provider until a new one has been appointed and they have been contacted by them in the following weeks.
It added that customers should take a meter reading ready for when their new supplier gets in touch.
This will make the process of transferring customers over to the chosen supplier, and paying back any outstanding credit balances, as smooth as possible.
Customers are advised not to switch energy supplier whilst Ofgem finds them a new one
Neil Lawrence, Director of Retail at Ofgem, said: ‘Although the news that a supplier going out of business can be unsettling, Utility Point and People’s Energy customers do not need to worry.
‘Under our safety net we’ll make sure your energy supplies continue. If you are a domestic customer with credit on your Utility Point or People’s Energy account this is protected and you will not lose the money that is owed to you.
‘We will update you when we have chosen a new supplier, who will then get in touch about your new tariff.’
A number of small energy suppliers have exited the market in recent times, including Extra Energy, Spark Energy, Future Energy, National Gas and Power, Iresa Energy, Gen4U, Usio Energy and One Select.
Justina Miltienyte, energy policy expert at Uswitch, said: ‘The news of People’s Energy and Utility Point ceasing to trade means seven energy suppliers have now gone under this year.
‘The announcement reflects the difficult conditions that challenger brands are facing. Many operate on thin profit margins and they have been hit hard by the knock-on effects of rising wholesale prices.
‘Ofgem will now choose designated suppliers for the 570,000 customers of both People’s Energy and Utility Point. However, those affected should wait until they know the details of the new provider before trying to switch.
‘Customers should be reassured that their energy supply will continue as normal and any credit balances they built up with those suppliers will be protected.
‘Once you know your supplier, and the tariff you have been offered, it is worth comparing prices to check if switching to another provider will offer better value for money. You will not be charged exit fees for moving to another supplier.’