NEARLY 1.5 million customers have been hit by energy firms collapsing under soaring gas prices.
Avro Energy and Green ceased trading on Wednesday and their 830,000 combined customers face being switched to a new, more expensive provider, putting them at serious risk of not being able to afford to heat or light their homes, or cook their meals.
Supermarkets have reported empty shelves and petrol stations have begun shutting.
In an emergency statement to Parliament yesterday morning Business Secretary Kwasi Kwarteng admitted that a number of energy companies had ‘exited the market,’ but insisted that this was ‘normal’. He said: ‘There are more than 50 companies in the market and we may unfortunately see more exit the market in the coming weeks.’
Labour’s shadow Business secretary Ed Miliband said: ‘On Monday, I said to the secretary of state that he was being far too complacent about the situation we are facing.
‘Events since have unfortunately borne this out.
‘Complacent about the crisis in the market, complacent about the impact on families and complacent about the cost of living crisis.
‘He pretended on Monday and then again today that it was “normal” for a number of suppliers to go down, but what we are dealing with is far from normal.
‘800,000 customers moving their suppliers yesterday alone, 1.5 million in the last six weeks. So will he answer the question that he has so far failed to answer?
‘Does he believe taxpayers money will be necessary to stabilise the market? If so how will he ensure value for money and that we do not simply end up with a greater concentration in the “Big-Six” suppliers?’
He added: ‘I have a letter here that Ofgem wrote to him when he was the energy minister 18 months ago during the Covid pandemic, warning, and I quote, about the “systemic risk to the energy supply sector as a whole”.
‘It said that “the use of Ofgem mechanism, the supplier of last resort may not be possible” and it went on: “The failure of medium and large suppliers would need to be handled by a special administration regime, placing significant burden and costs on government”.
‘So will he answer the question of what planning was done for this eventuality following that letter?
‘Surely government should be in a position now to know exactly what needs to be done when there is systemic risk to suppliers, and haven’t they left the country dangerously exposed with them scrabbling around for solutions?’
With the £20-a-week cut to Universal Credit due to kick in in just a week’s time, Miliband asked Kwarteng how he could ‘justify this attack on living standards?’ with energy prices on the rise.
‘The only right, proper and fair thing to do is to cancel the cut,’ he said.
Kwarteng replied: ‘With regards to the special administration regime, that is something that is in place, thankfully we haven’t had to use that. It is there should the case arise.’