After 4 years, 100,000 homes and 20,000 businesses – Extra Energy goes bust. Having started my journey there in the energy industry, I have mixed feelings. Overall though, the business model of selling energy at a loss for 1 year so they could auto-renew them at a massive profit the next year is ridiculously shady.
You won’t lose supply of electricity or gas so don’t worry about that.
Ofgem will put your supply and everyone else’s up for bid. Suppliers will offer various different offers, and you’ll effectively be sold to the highest bidder. Sucks but that’s how it works.
Ofgem advise you to sit and wait for that to happen, whether that’s my advice or not.. You’ll have to get in touch with me privately – [email protected]
First thing’s first is take a meter reading today, even if you have a smart meter since Extra Energy estimated most of their bills. You don’t want to be stung twice and pay for more than you’ve used.
You can’t contact Extra Energy since all their staff have been made redundant now, you just have this notice on their website with some information on it;
Your current contract is void. Domestic customers will probably get the same rate they were paying. You may however get placed on a very high one so be aware.
Business customers have no chance getting the same rates they were paying with Extra Energy. You’ll have to shop around for a new deal. The new supplier that wins the Ofgem bid, will probably be hoping you go with them on their “cheap” tariff. My advice; forget it.
Currently Switching to Extra Energy?
Contact your previous supplier, other suppliers, your broker or myself and get a new contract agreed. This is vital as otherwise you will end up in limbo on deemed expensive rates.
In Credit or Debt?
If you’re a domestic customer, you’re fine you’re credit will be paid back to you. if you’re in debt with them, you might get away with it.
As for business, you’ll probably lose your credit with them. Plus if the new supplier “purchases” Extra Energy’s debt, which they probably will, then you will have to pay it back to them.
Philippa Pickford, Ofgem’s interim director for future retail markets, said:
“We will also ensure that domestic customers’ credit balances are protected. Ofgem will now choose a new supplier and ensure you get the best deal possible.”
Notice how no mention of business customers?
Should you cancel it? I would. The new supplier should be able to automatically move your direct debit over to them.
You can read in more detail Ofgem’s 2008 report on this issue in general;
Guidance on supplier of last resort and energy supply company administration orders