Council-backed supplier Bristol Energy has appointed Ernst and Young to undertake a “full and thorough assessment” of the company’s structure and future business viability.
Reports from Sky News today (4 May) have suggested the company is up for sale.
The news comes following the departure of managing director Marek Majewicz and the appointment of company turnaround specialist Allan Booth.
A council spokesperson added that a key objective of the review is to mitigate the extent of any additional funding requirement from the council beyond the existing agreed funding.
The publicly-owned retailer, which was launched in 2015, made a £12 million loss in 2019 and did not expect to be in the black until 2021.
Last year the supplier reported having more than 104,000 domestic customers and 1,400 business customers, over 4,500 sites.
In response to Bristol’s announcement Juliet Davenport, chief executive and founder of Good Energy, said it was no surprise the company was reportedly up for sale.
She said: “Coronavirus is pushing all company strategies to the limit, and the energy industry is no exception. The grid is seeing historic drops in demand and the regulator is worried about large numbers of people not paying their bills. It is no surprise that Bristol Energy is up for sale; the mounting pressure on local authority budgets means the company has come under pressure to demonstrate a viable long term business case.
“Lots of suppliers have been chasing energy customers through low prices and racked up huge losses in the couple of years before lockdown. They will now have to rethink the way they operate. The priority for us at Good Energy is to protect customers, and hope that government at all levels stops supporting zombie businesses, while making sure we rebuild our economy as green as possible.”
The loss-making supplier is not the only council-backed retailer to come under scrutiny as of late.
Late last year, the chief executive and chief financial officer of Nottingham City Council’s Robin Hood Energy were both suspended and an internal investigation launched after a £23 million loss was posted.
In 2019 Utility Week conducted an interview with Marek Majewicz. You can read it here.