Iresa Limited - New Energy Company?

Our Verdict
Proceed with caution.
Please note that this message is not unique to Iresa Limited but issued for all new energy suppliers which have a limited track record, limited if any capital backing and which are unprofitable and / or have negative net assets. We are particularly cautious on those energy suppliers that take money from customer accounts before the customer comes on supply. We monitor new suppliers closely and should any of these circumstances change, for example a significant capital raise, then we will update our verdict accordingly.
IRESA is a new independent UK gas and electricity supplier based in Nottingham. They began taking on customers in March 2016 and passed CME (Controlled Market Entry) in August 2016.
Their stated aim is to focus on price and quality of service. In addition they state their core values as being;
- Integrity
- Passionate about our customers and people
- Measure success through sustainable customer satisfaction and energy affordability
Their goal is to create their own proprietary technology, rather than paying a third party for outsourced systems or operations, which "will save money with the hopes of passing it down to the customers."
While their prices are certainly competitive, Iresa Energy, like many of the growing number of new suppliers that have entered the market recently, is very much an unproven entity. We are great believers in competition and also hugely admire the entrepreneurial spirit (we have built two start-ups ourselves) However, there are several things about IRESA Energy that make us cautious.
Firstly, they are too enthusiastic in taking money from the customer's account. Your first direct debit is taken from your account 3 days after the cooling off period. This is at least 10-12 days before the supply of energy even starts to your home. This means that you, the customer, are basically funding the working capital to run the business.
Secondly, the company has minimal financial backing. It has equity capital of just £1 (one British pound). While it appears to have built up some trading revenue and assets in its first year of operations, those financial assets have subsequently been depleted. To year-end 31 December 2015, the company reported negative net assets of (£89,167). It is not unusual for a start up to incur losses; most do in the start up phase. However, with equity capital insufficient to cover these losses, it means that, should Iresa Energy get into financial difficulties, then customers who have paid in advance, as unsecured creditors, risk losing those payments. Iresa is also reliant on upfront payments from customers to fund its growth and should customers ever wish to get back their excess deposits (as is their right) then Iresa could find itself with an unpleasant whole in its balance sheet.
Finally, we support their ambition to build their own technology to run their business. But building technology is not without its own risks. If it works they will probably earn a small fortune selling it to other energy suppliers. But if it doesn't....?

Super_Jethro wrote: »

Some googling reveals the following:

1) The building of the registered office is a rent-a-space affair.

2) Brand new supplier so obviously not much feedback.

3) The name of the registered owner I won't post here as it'll just be removed again but you can find it by searching for "energy advise iresa review" - note that the registered office address you'll find there is different to that for IRESA that is filed with companies house. Googling his first name and surname leads to 2 companies house results for company directors:

Iresa energy

where our man lists his occupation as IT consultant

and

2 unrelated, defunct IT Consultancy companies:

Company numbers: 06830667 + 06824259. Both listed their office as residential addresses in London (one of which can't be found by google as the streetname appears to be non-existent).
Note that the 2 defunct companies in the second link are both listed as IT consultancies, were both started in 2009 and both were dissolved by 2011. Neither seems to filed much in the way of accounts with Companies House.

I don't know about you but seeing 2 listings for a Director with identical first, middle and last names, identical birth month + year, identical nationality (Nigerian) and identical occupation makes me think this is the same bloke listed twice.

All other considerations aside:
Him setting up and dissolving 2 IT consultancy firms 6 years ago gives me very little confidence in his ability to run a small, brand-new energy provider, out of rented office space, which says they will take the direct debit as soon as they can after the 14-day cooling off period and before I've even had a bill!

For the sake of £6 extra per annum I'll be going with a known entity TYVM.

Apologies for not just posting a URL to the results I found but because I just joined the forum i'm not allowed to post links (spam filter stops the post going through). Hopefully those reading this can follow my searching and reach the same results I did.