MSE News: GB Energy goes bust, 160,000 customers affected

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fredandwilma wrote: »

Imagine the knock on effect to customer service, this is going to have on the one or more of the big 6 companies chosen, (as it inevitably will be?) A massive rise in complaints as they deal with the aftermath? I feel for everyone involved.

I read the Ofgem blurb. Unless I am mistaken (which is easy as it is so wishy washy and convoluted) companies have to volunteer to be a SoLR, and doing so subjects them to what look to me like punitive conditions. (Ofgem even want them to agree to fund someone else's losses themselves)

As there is nothing in it for them except extra work and financial loss (which they might be able to offset against taxes I suppose), why would anyone volunteer?

Now if the big 6 were forced to offer terms as a SoLR that might be different, but it would be a race to the bottom, as they all compete to offer the worst out of fear of winning

Jackd178

Tbaron,
No,unfortunately I didn't download any of my bills. I never expected GB Energy to go bust. Thought Ofgem would have put the slide rule over them to ensure they were a fit and proper company to run such a business.
I do have 12 months of meter readings taken on the 17th of each month, so I'll hope my maths works out and and give your suggested calculation a try.
Many, many thanks for your reply. I think this will help a lot of people to get better transfer deals.

Mr_K

facade wrote: »

As there is nothing in it for them except extra work and financial loss (which they might be able to offset against taxes I suppose), why would anyone volunteer?

160,000 new customers on their books at their highest tariff, that's whats in it for them. Sure a lot of them might switch away pronto, but even if they retain half they're quids in.

As for credit balances, the new company doesn't necessarily have to pay , there'd be a levy accross the industry (according to the Torygraph http://www.telegraph.co.uk/business/2016/11/27/gb-energy-closure-could-trigger-domino-effect-raise-prices-consumers/). i.e. this might affect everyones bills, GB customers or not.

Mr_K

Jackd178 wrote: »

Tbaron,
No,unfortunately I didn't download any of my bills. I never expected GB Energy to go bust. Thought Ofgem would have put the slide rule over them to ensure they were a fit and proper company to run such a business.
I do have 12 months of meter readings taken on the 17th of each month, so I'll hope my maths works out and and give your suggested calculation a try.
Many, many thanks for your reply. I think this will help a lot of people to get better transfer deals.

It is underhand not to let you look log and see your latest bill/balance. Can't see any reason not to let you do so. Can only assume its smoke and mirrors to try and hide customers finding out their credit balances. OFGEM - pull your finger out and at least sort this.

System

Mr_K wrote: »

It is underhand not to let you look log and see your latest bill/balance. Can't see any reason not to let you do so. Can only assume its smoke and mirrors to try and hide customers finding out their credit balances. OFGEM - pull your finger out and at least sort this.

No point in posting here: I suspect that Ofgem doesn't have the time to read MSE Forums. Try e-mailing them at:

consumeraffairs@ofgem.gov.uk

Mr_K

Hengus wrote: »

No point in posting here: I suspect that Ofgem doesn't have the time to read MSE Forums. Try e-mailing them at:

consumeraffairs@ofgem.gov.uk

I suspect they have loads of time as they do sweet nothing. They probably read these forums to find out what's going on. I was £20 in credit earlier this month, so probably about evens by now, so no big deal. There's no way i'd let a credit of £100's rack up with any company . DD cancelled so that's some extra money for Xmas

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Mr_K wrote: »

As for credit balances, the new company doesn't necessarily have to pay , there'd be a levy accross the industry (according to the Torygraph http://www.telegraph.co.uk/business/2016/11/27/gb-energy-closure-could-trigger-domino-effect-raise-prices-consumers/). i.e. this might affect everyones bills, GB customers or not.

Ofgem said that the levy would be spread across all energy customers but would only have a small impact on bills.

My dog has more common sense than Ofgem, unless it is a misquote, and Ofgem said should rather than would :rotfl::rotfl::rotfl::rotfl:


Actually, that means I will pay extra to refund myself my own credit, maybe they are in front of the dog slightly

fredandwilma

facade wrote: »

I read the Ofgem blurb. Unless I am mistaken (which is easy as it is so wishy washy and convoluted) companies have to volunteer to be a SoLR, and doing so subjects them to what look to me like punitive conditions. (Ofgem even want them to agree to fund someone else's losses themselves)

As there is nothing in it for them except extra work and financial loss (which they might be able to offset against taxes I suppose), why would anyone volunteer?

Now if the big 6 were forced to offer terms as a SoLR that might be different, but it would be a race to the bottom, as they all compete to offer the worst out of fear of winning

https://www.ofgem.gov.uk/system/files/docs/2016/10/solr_revised_guidance_final_21-10-2016.pdf

Claims for last resort supply payments

2.24. The role of SoLR represents a significant logistical challenge to a supplier. The supplier is likely to incur increased administrative costs and will have to implement additional energy purchasing arrangements. These will have to be activated and managed within a very short period of time. However, there are also potentially valuable commercial benefits to a SoLR. It will not have the normal acquisition costs (for example, paying commission to price comparison websites) and will have the opportunity to convert the customers it has acquired as a SoLR to normal contracts.

2.25. Electricity and gas suppliers’ licences permit them (in some circumstances) to make a claim for the otherwise unrecoverable costs that they have incurred in being a SoLR. This would be paid by a “levy” on gas transporters‟ and electricity distributors' Distribution Use of System (DUoS) charges.

12 Suppliers will need to take into account the applicable customer objective and standards of conduct in setting this rate.

Guidance on supplier of last resort and energy supply company administration orders

2.26. We would generally prefer a SoLR not to make a claim via these arrangements for costs it has incurred carrying out its role although we recognise that circumstances may exist which would justify a departure from this general rule. The circumstances of every supplier failure are different and there may be some where aSoLR incurs costs which would not otherwise be recoverable. An efficient SoLR should be able to minimise its exposure to these costs.
2.27. Following appointment of a SoLR that had not waived its right to make aclaim, we will decide on a case-by-case basis whether it might be appropriate for a SoLR to make a claim on the levy. We would consider whether the amount of any claim or the reasons for any claim were reasonable. For example, we may in certain circumstances consider it appropriate to approve the claim where it relates to costs associated with the protection of customers who held a credit balance with the failed supplier as outlined above.

sillygoose

If it were a different company to GB Energy going bust there might be more in for the SoLR, but the nature of GB.E - small rock bottom outfit (pre-hikes) meant it mainly attracted savvy comparing/switching prone customers so the SoLR's chance of retaining any on higher rates for long must be very low.

Bizarrely I got my "Your GB Energy Supply bill is ready" email from GB Energy at 7am this morning, not much use if the site is offline. Only £26 in credit.

KGriff

As a GBEnergy customer, I have to say I feel sorry for those young people who work for them, who may have lost their jobs in the run up to Christmas.

I can only imagine how they all must be feeling and whether or not they can find new jobs quickly and be able to pay their own bills. I just hope everyone lands on their feet and gets another job soon, particularly those people with young families.

I am just very slightly in credit with my gbe account and it wouldn't be the end of the earth if I were to lose a small amount, so I'm in a fortunate position on this occasion, which makes a change.

My direct debit is due this coming week and whilst I have read much about not cancelling it, I decided to not heed the advice and have just cancelled it online. I can't see the point in letting a payment go out to a company that has officially announced it has now ceased trading.

It's easy to make a one-off payment over the phone these days to any company that may take over my energy account and that seems a much more preferred option I think, until the dust settles on this situation and a new direct debit can be arranged with a new appointed provider.

I see there are lots of folk who think offgem are going to let the 160,000 gbe customers fall into the hands of an unscrupulous LOLR and we will all be put on one of the most expensive tariffs out there. Personally, I don't think that will be the case and I'm sure a fair 'compromise' will be achieved and maybe a period can then follow whereby people can stay with the chosen company, or move to a preferred supplier.

Yes, it may take a while to resolve this unprecedented situation, but like any sensible person, I plan to set aside my own monthly direct debit payments into a separate fund (plus an added 15%) until such time as I need to settle things with any suppliers involved.

It's not then a case of holding back any payments, it's more about taking direct control of them until everything is sorted.

The only sad bit is that the decent 'cheap' and 'fixed' energy deals are now disappearing real fast and I would like to be able to switch as soon as practicable to a preferred supplier. At the moment there does not appear to be a way to do that until the LOLR is appointed. So that's the part of the process I would like to see ofgem resolve sooner, rather than later.

Anyhow, I found GBEnergy's customer service to be very good during the past 10 months and so I would like to wish them all (and their families) the very best for Christmas and New Year and hope they can each find a new job to go to.

Thanks to ofgem and their current systems in place, I'm a little more upbeat about things than some others are here ...and whatever happens, for the last few years I have had cheaper energy than a good many others who rarely switch energy suppliers and so I'm not going to complain about these things too much.