Business energy supplier and third-party gas shipper, CNG Group, has hired Interpath Advisory following the recent rise in wholesale energy prices.
The Glencore-backed company, which is based in Harrogate, serves 46,500 meter points which are primarily SMEs. Its wholesale shipping business has a portfolio of 30 smaller companies.
In a statement this afternoon (24 September) the company said that the current market volatility has given cause for its board to “consider the strategic future of the business” and that as such it has appointed advisors.
CNG added: “Some firms in the sector have become insolvent and their portfolios of meters have been moved to new shipping relationships under the Ofgem Supplier of Last Resort (SoLR) process. Ofgem and the government have both stated that more companies in the sector are expected to fail.
“The board of CNG constantly reviews the environment and market conditions to assess the outlook for the company. The current market volatility has given cause for the board to start to consider the strategic future of the business and advisors have been engaged to explore options.
“However, no decisions have been taken at this stage. CNG remains solvent and continues to provide services to its wholesale and retail customers and the directors are in regular communication with Ofgem, as is normal.”
Tony Jordan, an energy industry consultant, described the news on LinkedIn as a “worrying situation”.
He continued: “The concern I have is a supplier that provides such third-party services has never failed before (to the best of my knowledge at least). So what does this mean for all of those ‘customer suppliers’ if that were to happen? Is that instant SoLR for all of them?”
Jordan added: “As much as I am really annoyed the energy market is allowed to suffer all that we’ve seen so far, this one falling would concern me more than any other.”