How can so many Energy Companies Fail?- who's next? AVRO? IGLOO? SYMBIO? COLORADO? NEON REEF?

jimjames

ihatetrump said:

Colorado has never filed any trading financial statements with Companies House and has changed it's year-end 3 times in what would appear to be a deliberate attempt to circumvent statutory filing requirements - there's therefore no indication of how big or small this supplier is.

The changing year end date trick was something that many mini bond companies used to avoid any scrutiny of their accounts. In the end London Capital & Finance went bust before they even needed to file. There seems no legitimate reason for that to be used multiple times.

ihatetrump

As I said earlier in my post, there appears to be a complete lack of financial regulation of the retail supply side of this industry. 

It really beggars belief that companies can be set up and bought and sold so easily in the sector with seemingly very little accountability or financial regulation.

It really shouldn't be left to amateur anorak sleuths  like myself to see what a mess some of these companies are in. 

AVRO has only ever filed one set of audited accounts for the 18 month period ended June 30, 2019 - because the Companies Act 2006 required it to - it was signed by one of its' two directors on June 30, 2020, signed by the auditors on the same day and filed at Companies House on the same day - which happened to be the very last day it could possibly file before it was in default. Those accounts only avoided an audit qualification on the basis of their future financial projections. The Directors/Shareholders (one and the same) gave no guarantees or pledges and yet the company continued to trade - £360M turnover over 18 months at the time and accumulated losses (funded by customer credit balances) of £27M.

OFGEM waits over 13 months until August 14th 2021 to ask to see those projections - AVRO has so far failed to produce them.

Go figure - a disaster waiting to happen. Yes credit balances will be transferred through SoLR - but as the receiving supplier won't receive the cash for the balance, they can only recover it through profits on higher customer charges - meanwhile the Directors/Shareholders of the failed company sail off into the sunset - no fuel poverty for them!

even as I type this, I see that Green has now gone to the wall.

BobT36

^ And AVRO! Lol:

"Avro Energy is ceasing to trade. Ofgem, the energy regulator, is appointing a new supplier for its customers.

Customers need not worry, their supplies are secure and domestic credit balances are protected.

Ofgem’s advice is not to switch, but to wait until they appoint a new supplier for you. This will help make sure that the process of handing customers over to a new supplier, and honouring domestic customers’ credit balances, is as hassle free as possible for customers.

Support and advice is available on the Ofgem website for both domestic customers and non-domestic customers. Alternatively, if customers need additional support, they can call Citizens Advice on 0808 223 1133 or email them via their webform. Advice will also be shared on Ofgem’s twitter @ofgem and facebook channels."

https://www.avroenergy.co.uk/

Wish I'd seen this thread sooner. I switched from Igloo to Avro just in August, and have been waiting for them to bill me for both August and September (despite providing two sets of readings. Unfortunately I only kept pics of one set). They refused to bill me, citing that it was "with the third parties". Now I know why.

Problem is they've now stuck that message on their website and disabled login (get an error immediately after login, can't browse submitted readings, "bills" or anything). They haven't said a WORD to customers, no e-mail or nothing, just sneakily stuck that message on their web page. Wouldn't have even known, if my mum wasn't always reading this forum!

BobT36

Looks like they've just milked it down to the wire, and then done a runner, leaving their customers in the lurch. 
The only saving grace is that with energy companies being privatised and the system as stupid as it is, the power stays on since they're not actually delivering it. (Bloody good job!). 

I imagine that since they're clearly not making "profit" through this multitude of small companies, the scam is to set up a load of ponzi companies fueled by anticipated future payments, then funnel that cash through the marketing firm.
As the marketing firm is a separate, legal entity I presume it has no liability for Avro's debts, so that's how they get the money out.

Unsure what happens to those "Director loans" from Avro, but if they made nearly a million in one year via the "marketing services" siphon, then if they're doing that with multiple companies at once, it won't matter. 

There's SO many scams on the go nowadays, parking, delivery agents, energy companies, green energy etc etc etc, how can we rightfully call ourselves a 1st world country?


The other downside of all this is that once again, the taxpayer is going to end up paying for it in one way or another at the end of the day, so we'll have our pockets double-dipped into, as usual. There's no wonder the gap between rich and poor just keeps widening, here we are arsing around so much to save just a hundred quid a year, where these guys are raking in millions at our expense..

badmemory

They won't bail these smaller companies out, but what will happen when one of the big 6 goes.  I guess it will be like bailing out the banks!

Mabel2012

I recently switched to Sainsbury's Energy for a 2 year fixed tariff. Are they likely to survive the winter.

phillw

Biggus_Dickus said:
However, the ‘credit balances’ are, I believe,  paid out of the SOLRs’ own funds and I wonder what may happen if there is an avalanche of failures and the SOLR’s don’t have the resources to cover such liabilities?

Where necessary, Ofgem would allow the replacement supplier to recoup the cost of reimbursing the credit balances through an industry levy.

This levy, which would be spread across all energy customers, would only have a small impact on bills. 

Ofgem’s senior partner for Consumers and Competition, Rachel Fletcher said: “It’s important that people are fully protected in the unlikely event a supplier goes out of business. Our safety net gives peace of mind so they can have complete confidence to shop around for the best deal.”

manic37

Mabel2012 said:

I recently switched to Sainsbury's Energy for a 2 year fixed tariff. Are they likely to survive the winter.

Most definitely will as they're run by EON Next.

Mabel2012

manic37 said:

Mabel2012 said:

I recently switched to Sainsbury's Energy for a 2 year fixed tariff. Are they likely to survive the winter.

Most definitely will as they're run by EON Next.

I hope you are right. I was tempted by the Avro fixed price but decided to play a bit safer as I was caught up in the Tonik fiasco last year and don't want a repeat any time soon.