The former secretary of state for energy and climate change has said the Conservative Party has “a lot to answer for” following the collapse of One Select Energy.
Liberal Democrat Ed Davey, who served in the coalition government, also called the government’s incoming price cap a “folly” which has had a “negative effect” on small suppliers.
Davey said: “This is a deeply worrying trend for consumers, four energy suppliers have gone in just a month.
“Not only does this create major uncertainty for customers, but also undermines competition in the market.
“People will not switch if they think their new supplier will go under.
“The Tories have a lot to answer for, rather than trying to shore-up competition in the market they’ve pursed their price cap folly, which clearly has had a negative effect on the small suppliers as the costs rise. Liberal Democrats demand better.
“We would scrap the Tories’ price cap and instead bring in measures to effectively boost competition, while strengthening the rules to ensure smaller suppliers can stand on their own two feet and provided a decent service to customers, while offering cheaper deals.”
In response to Davey’s comments, a Department of Business, Energy and Industrial Strategy (BEIS) spokesperson told Utility Week: “The energy price cap protects consumers on default tariffs and Ofgem sets the level to ensure suppliers can continue financing their business.
“We want a competitive market that is innovative and adaptable – today, there are around 70 suppliers in the market compared to 13 in 2010.”
In response to the news of the collapse the Energy Ombudsman said it had been aware of “customer service issues” at One Select for some time, and had attempted to work with the company to try to improve its complaint-handling process.
David Pilling, head of policy at the Energy Ombudsman, said: “As we have done following the recent collapse of other suppliers such as Iresa and Extra Energy, we are keen to work with whoever is appointed to take on One Select’s customers in order to ensure a smooth transition.
“If you’re a consumer who has a complaint about One Select open with us, please be advised that we will be in touch in due course with information on next steps.”
Meanwhile a spokesperson for consumer group Which? said: “One Select customers will understandably be concerned, but there is no reason to panic. Your energy supply will not be cut off and will continue as normal.
“We would encourage affected customers to take a meter reading as soon as they can, and when your new energy supplier contacts you, ask for the cheapest deal available.
“It’s important to bear in mind though you don’t have to stick with the new supplier chosen for you by Ofgem. Do some research to compare the deal you’ve been offered to others on the market, and if you find a better one, switch away.”