Several smaller energy companies have already gone under, due to rising gas prices reaching new highs.
Wholesale prices rose by 250% in the first half of 2021, causing widespread impacts across the UK.
Bulb Energy provides their customers with 100% renewable electricity, using solar, wind, and hydro sources.
For every unit its customers use, another unit of energy is produced and returned to the grid using these renewable sources.
The supplier also uses 100% carbon-neutral gas, as it offsets the emissions from the gas via global carbon reduction products.
Here’s the latest with Bulb and how entering adminstration affects its customers.
Why are some energy suppliers in trouble?
Increased wholesale gas prices mean that trading for energy suppliers has become trickier, as they are forced to pay higher costs for gas than they receive from customers.
This is particularly difficult for smaller energy suppliers, who have less room to spare when it comes to profits.
So far, Green Supplier Limited, Avro Energy, People’s Energy, and four other smaller suppliers have already closed their doors.
Are Bulb going bust?
The government began accelerating contingency plans for the collapse of Bulb Energy, the UK’s seventh largest domestic energy supplier, towards the end of October.
On November 22nd, the energy company announced on Twitter and via a statement on its website that it had made “the difficult decision to support Bulb being placed into special administration”.
This makes for the biggest shut-down of any energy supplier in the crisis so far.
To give a sense of scale, the number of customers served by Bulb is almost equal to the total number of customer served by the 14 energy companies that have shut down since the start of August.
At a court hearing on November 24th, it was revealed that the government had already set aside £1.7 billion of taxpayer money to support the work of Teneo, the management consultancy company which has been assigned to handle the administration of Bulb, ensuring customers have an uninterrupted energy supply over the winter months.
This is because Bulb is so much bigger than the other 20 or so firms that have so far collapsed as a result of the energy crisis.
In those cases, Ofgem was able to handle the logistics of these companies alone.
Who owns Bulb Energy?
Bulb Energy is owned by parent company Simple Energy, which has also gone into administration.
The public statement from Bulb confirms that international businesses in France, Spain, and Texas will continue trading, as they are separate businesses from Bulb in the UK and are not affected by the supplier entering special administration in the UK.
However, Bulb’s collapse does put 1,000 jobs at risk here in the UK.
What happens if Bulb goes bust?
Bulb has been quick to reassure customers that customers do not need to take any action.
"Special administration is designed to allow Bulb to continue to operate as usual so you don’t need to take any action,” wrote the company.
"Your tariffs are not changing, and the price cap applies to all consumer energy tariffs.
"If you pay for your energy by top up, your top ups will continue to work as normal. If you’re in the process of switching to or from Bulb, your switch will continue.”
For customers of Bulb, there is nothing you need to do and your energy supply will not be disrupted.
If you are not already switching, then Ofgem will be taking over the logistics of your energy supply.
It’s advised to take a meter reading for your records, which can aid in making sure you only pay for what you’re using during a switch.