Friday, June 21, 2024
Energy Transition Outlook Report 2023
HomeRenewablesbulbBillpayers could foot the bill for energy supplier failures, warn MPs

Billpayers could foot the bill for energy supplier failures, warn MPs

The Public Accounts Committee (PAC) has raised concerns about the accessibility of energy bill support for those in need and the potential burden on taxpayers following the collapse of energy supplier Bulb.

While commending the government and regulator Ofgem for their swift actions to protect customers, the PAC revealed that not all eligible households have claimed the support offered.

The PAC’s report also criticised Ofgem’s “low bar” approach to licensing energy suppliers, which led to numerous suppliers failing and incurring costs to the public.

The committee recommended that Ofgem and the government ensure that only financially resilient suppliers receive licences while maintaining healthy competition in the energy market.

The PAC has highlighted that while the government anticipates recovering a significant portion of the investment aimed at safeguarding 1.5 million customers affected by Bulb Energy’s failure, there is a risk that consumers may ultimately be burdened with the costs if the full funding recovery is not achieved.

According to the PAC, it is estimated that around £2.96 billion of taxpayer funds could potentially be recuperated from Octopus Energy Group, which acquired Bulb.

However, MPs claim that this still leaves an approximate shortfall of £246 million that could potentially be shouldered by energy billpayers.

Dame Meg Hillier, Chair of the Committee, said: “Our report is a sobering reminder that we are still living with the fallout of the failure of so many energy suppliers in 2021-22.

“While the government and regulators did the right thing in moving swiftly to protect consumers, the uncomfortable truth remains that the recovery of that investment hangs on the commercial success of one company. The public can ill afford such uncertainty, particularly in challenging economic times.”

A Department for Energy Security and Net Zero spokesperson told ELN: “Placing Bulb into a special administration regime was the only viable option to ensure Bulb’s 1.5 million customers were protected, while providing best value for the British taxpayers.

“We will continue to do this and have put in place protections to safeguard any credit balances.

“We also recognise people are facing cost of living pressures and we are supporting the most vulnerable this winter, including providing three million families with £150 off their energy bills through the Warm Home Discount.

“We are reviewing the committee’s report and will respond to their recommendations in due course.”

Energy Live News has contacted Ofgem for comment.

Energy Live News
Energy Live News
This article first appeared on Energy Live News, an award winning news service. Their mission is to give you balanced news, analysis, commentary of energy from their dedicated team of quality journalists and production staff.
- Advertisment -
Energy Jobline LinkedIn

Most Popular

Recent Comments