Ofgem has said it will step to ensure a smooth transition for customers as yet another small energy provider went out of business today, the sixth this year.
Customers of Extra Energy will be protected by the regulator’s safety net, it said.
The company’s 108,000 domestic and 21,000 business customers have been told not to switch to a new supplier as the regulator promised to find a company to take over Extra’s accounts.
Philippa Pickford, Ofgem’s interim director for future retail markets, said: “If you are an Extra Energy customer, under our safety net, we will make sure your energy supplies are secure. 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. Whilst we’re doing this, our advice is to ‘sit tight’ and don’t switch. You can continue to rely on your energy supply as normal. We will update you when we have chosen a new supplier who will then get in touch about your new tariff.”
Citizens Advice chief executive Gillian Guy said: “Today’s news and other recent supplier failures again highlight how essential it is that suppliers operating in the market have sustainable business models.”
Earlier today Ofgem released new proposals which would force suppliers to show they are viable before getting a license to enter the market.
It said the proposals will help insure the industry, and customers, against bankruptcies.