Bulb about to fuse

[Andrew]

Just heard on the R2 news that Bulb are about to appoint administrators.

It's becoming a turkey shoot of the minnow energy co's.

Andrew

[Scott]

I think Ofgem will need to set up an operator of last resort, as with the railways.

[Robin]

I think that terminology is misleading.

What they have been using so far are "supplier of last resort" arrangements included in supply licences which allow Ofgem to appoint a company to take over.

If that becomes impracticable - because even the big suppliers can't absorb the customers - they have a back-up. They can ask the court to appoint an administrator to carry on supplying the customers under the special Energy Supply Company Administration Rules.

[Scott]

Thanks. I didn't realise that. Similar I suppose to the Department for Transport taking over LNER to secure the finances then employing essentially the same management and staff to run the trains.

[Andy Burns]

From Times Radio just now, sounds like they are using a "special administration regime" for Bulb, instead of SoLR?

[newshound]

Wow it has got that bad!

[Andy Burns]

Well, Bulb by themselves seems to have as many customers as all the other dead suppliers this year put together ...

[Andrew]

1.7 Million. No other supplier will take them.

[Mark Carver]

For starters Excel can only support 1,048,576 rows

[pinnerite]

I am very disappointed. They have/had the most customer-friendly website of any utility company I have ever used. I even had a hassle-free home change during the last year.

Veery sad.

[Pancho]

Speak for yourself, they messed up my switch over, refused to do anything about it, so I sorted it out.

Then weeks later they claimed they had made a mistake and then tried to cheat money out of me after I told them I had sorted it out and not to do anything.

The smart electric meter hasn't been smart for a year, the gas one works.

I suppose I should block my DD ASAP.

[Richard]

Oh no! Anyway...

[Jethro_uk]

Well that's our supplier ...

We'll end up with two.

And I *still* can't change water companies. Which was one of the promises of privatisation and no less bonkers than creating gas companies that don't drill for gas, and electricity companies that don't own an inch of cabling ...

[Brian Gaff (Sofa]

Bulb are not that small though. I do feel that somebody, somewhere has taken their eye off the ball so to speak. What would happen if some of the major players refused to take on the customers who are left with no supplier? One assumes they would just cut those off with smart meters and then what of the rest? I never did see the real efficiency in allowing loads of companies to make profits from creating bills. Brian

[Brian Gaff (Sofa]

trains are somewhat different to energy though, as it would not take long if the supply got cut for it to cause real hardship or damage to the economy. I'm surprised that instead of this, there was not a system where a company facing the endoof the line could vary the contract price to remain solvent. These things would seem to be cyclic, and one assumes as old contracts end for those being transferred the only game in town will be the other suppliers pricing, so what would be better here.

Brian

[Martin Brown]

They were allowed to set up as clueless box shifters with no idea of what they were selling or where they were getting their supply from. The price spike that makes the product more expensive for them to buy than they are contracted to sell it to their customers is a lethal bind.

All you had to do was think of a plausible brand name to get going.

That is exactly what *has* happened with Bulb. They are too big to fail and the big 5/6 have refused to take on additional money losing customers so the government will have to step in. That or people who buy their electricity from no nothing box shifters will all freeze to death this winter. You pays your money and takes your choice.

The price cap might protect consumers for now but in reality no business can continue to exist selling product at below cost price for long.

It was insane and badly thought out. They didn't understand that one day there would be a gas supply crunch and the historical dash for gas in electricity generation would make their spot market buying tactics fail.

The established big players buy their energy on long term contracts and some of them actually *make* the stuff that they are selling in another arm of the business and so can cross subsidise losses in the short term.

I don't think this steep price rise in energy *is* short term. I doubt if it will ever come down and people will just have to get used to much higher energy bills. We will also have to pay for sorting out the huge mess created by this ill thought out disastrous privatisation scheme.

It could even get a lot worse if Russia decides to flex its muscles again over the approval of the disputed new gas pipeline in Germany. I expect they will wait until it gets colder though for maximum effect.

[alan_m]

But for millions of customers this model worked for a decade or more in providing prices lower than most of the major players, and because of this competition and a large churn rate in some years away from those major players lower prices overall for all when "times were good" for trading.

The Government and Ofgem set in place the mechanism for this type of failure a very long time ago so it was foreseen that this could happen.

[Pancho]

I really don't understand this. There is a very liquid market in energy wholesale financial derivatives. It should have been possible to hedge for this type of eventuality.

The government does seem to have been negligent, firstly long term, in not ensuring national energy security and secondly not insisting that energy companies had a reliable/prudent business model.

[Martin Brown]

When times are good even a clueless idiot can make money selling energy.

We will have to wait and see how it pans out. I reckon if you buy your energy cut price from a dodgy company "Aardvark Clueless" that doesn't even make the product you deserve what you get when they go bust.

It was but the companies that have gone bust were not bothering to do that to keep costs down. So long as there is a plentiful supply of gas there isn't a problem. However, the moment that there is a shortage with the new players all fighting for marginal supply on the spot market.

Allowing our domestic gas storage capacity to drop to barely more than a week was another contributing factor in how high the price spike went.

[Scott]

I think there is. The franchise can be terminated and the train operating company be given a management contract, where they are paid a management fee but the government takes the revenue risk. This is the arrangement AIUI with Great Western and many others.