Birmingham-based supplier Extra Energy, which made a £26.7 million post-tax loss in 2016, has ceased trading.
In a statement released today (21 November) industry regulator Ofgem said it will choose a new supplier to take on Extra’s customers “as quickly as possible”.
Under the regulator’s safety net, the energy supply of Extra Energy’s customers will continue as normal.
The outstanding credit balances of domestic customers will be protected.
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.”
In 2017 the company, which had around 108,000 domestic and 21,000 business customers, came bottom in Citizens Advice’s customer service league table for the second-time running.
On the complaints handling measure, Extra Energy delivered the worst score recorded by Citizens Advice – 1,916 per 100,000 customers – for the first three months of last year.
Today’s announcement comes after Ofgem proposed new financial and customer service tests for suppliers seeking a supply licence.
Under the proposals, companies would have to demonstrate they have “adequate financial resources” and can meet their customer service obligations before being awarded a license.
This means they must provide the regulator with a plan to meet its handling standards and obligations to assist customers in vulnerable circumstances.
Ofgem is also consulting on tightening its test of whether applicants are “fit and proper” to be granted a licence.