Millions of taxpayers cash to keep Bulb going

Gerry1

Rich2808 said:

Gerry1 said:

Rich2808 said:

That is why they have stepped in - because the free market has failed!

IIRC Bulb went bust not because the free market failed but because Ofgem forced them to trade at a loss by capping their standard variable tariff, the only tariff that they offered.

Weren't all these suppliers aware of the rules and regulations when they entered the market?

They would have needed a time machine or a very good crystal ball: Bulb was founded in April 2013 but the Ofgem price cap wasn't set up until January 2019.

ihatetrump

Weren't all these suppliers aware of the rules and regulations when they entered the market?

Plenty of other suppliers haven't collapsed.

I'm sure they were all aware of the rules, it's just that some of them thought some of the rules didn't apply to them or were maybe optional if they didn't want to participate:

Consider that AVRO baulked and delayed at paying (and never did) £56M of ROC - Together Energy is playing the same game also with the £12.4M that they owe along with a few others that seem to be dragging their feet. Remember that these Renewables Obligations were supposed to be part of the tariffs they charged in the first place - they knew that when they signed up (or bought their off the shelf supply company).

chris1973

Hopefully at least it will spell the end of endless referral link spam clogging up forums and social media from users who coincidentally spout how wonderful, beautiful and bountiful Bulb is.

MWT

A_Lert said:

Nobody's answered my comment about prepayment meters. They automatically cut off the supply if you can't top up. The meter doesn't know the reason you can't top up is you don't have a supplier. While I'm sure that can be bypassed, who would do the bypassing?

In this case there should be no impact on pre-pay customers as they are not being transferred to a new supplier, Bulb just keep on going for now, but 'under new management'.

Jaybee_16

A_Lert said:

Nobody's answered my comment about prepayment meters. They automatically cut off the supply if you can't top up. The meter doesn't know the reason you can't top up is you don't have a supplier. While I'm sure that can be bypassed, who would do the bypassing?

From the email received earlier today.

We've made the difficult decision to support Bulb being placed into special administration. This process is designed to protect Bulb members, ensuring there's no change to your supply and your credit balance is protected.

We'll update you once we know more. We continue to operate as usual so you don't need to take any action. Your tariffs are not changing, and the price cap applies to all consumer energy tariffs. If you pay for your energy by top up, your top ups will continue to work as normal. If you're in the process of switching to or from Bulb, your switch will continue.

dbks

roddydogs said:

All the £50 refer a friend coming home to roost!

£50 each!  £100 each on a good day!

Another failed pyramid scheme. Who'd have thunk it.

dbks

Gerry1 said:

Rich2808 said:

That is why they have stepped in - because the free market has failed!

IIRC Bulb went bust not because the free market failed but because Ofgem forced them to trade at a loss by capping their standard variable tariff, the only tariff that they offered.

Bulb have never made a profit.

They preferred to sell at a loss to increase their market share. That was always their policy.


This from 2018:

Investing in growth

The report will show how we performed over the past financial year (April 2017 - March 2018). In this period, Bulb generated £182.8m in revenue (broadly, that’s the amount we get paid by our members). We made a gross profit of £12.1m after we’d paid our generators and the energy network. And after we deduct the costs of paying all our people, for our offices and the costs associated with acquiring new members we ended up with a £23.7m net loss. This is because we choose to invest in growing the business and signing up new members; something we’re unashamedly interested in doing. Every new member means a greener UK. But we only grow in a sustainable way; we make a fair and healthy profit from every member. And in the middle of this year we sold shares in the company to investors for £60m. This was recognition of the solid, responsible business we’ve built, and will fund our continued growth.
necessary to shore up our finances ?

https://bulb.co.uk/blog/annual-update-for-members-2018

and who could forget this classic post by @Will_at_Bulb (I wonder whatever happened to him? It would appear to have been his parting post on MSE)

"The numbers can look alarming at first glance, but we're in a very stable financial position. We've also made no attempt to hide this.
...
Losses don't tell the full story. We invested all that money in growth, something we're unashamed to have done. The more people that join Bulb, the greener the UK becomes and the more people save on their energy. That's why Bulb exists.

Since January 2018, we've grown from 200,000 members to 870,000 members. We have to pay each time someone joins us through a referral or through a comparison site like MSEs Cheap Energy Club. We'll then recoup that cost over a few years when that member has been with us for a while...."

dbks

chris1973 said:

Hopefully at least it will spell the end of endless referral link spam clogging up forums and social media from users who coincidentally spout how wonderful, beautiful and bountiful Bulb is.

Don't worry, there is always the Octopus posse who will continue that trend

QrizB

dbks said:

Gerry1 said:

Rich2808 said:

That is why they have stepped in - because the free market has failed!

IIRC Bulb went bust not because the free market failed but because Ofgem forced them to trade at a loss by capping their standard variable tariff, the only tariff that they offered.

Bulb have never made a profit.
They preferred to sell at a loss to increase their market share. That was always their policy.

Hmm, the Amazon / Uber / We Co model? It worked for Amazon, the jury's still out on Uber, and last I saw We were losing $1Bn a quarter.

pecuniam_hominem

Rich2808 said:

pecuniam_hominem said:

Rich2808 said:

emmajones1976 said:

oliverbrown said:

emmajones1976 said:

So your theory is that they would do that to 1.7m people, most of which would have paid their bills on time, if the worst came to the worst?

Who is scaremongering now?

Not me, read back to see who first brought this into the discussion. 

The issue doesn't arise because the Government has provided a bailout to keep Bulb going and supplying their customers.

If the Government had not Bulb would have ceased trading - as it essentially had run out of cash and its bankers weren't prepared to keep it going - and those 1.7 million households would have no supplier. And yes - that could have meant supplies cut off.

The whole point - which you seem again to be missing - is that this issue will not arise and no one will be cut off because the Government has stepped in to bailout the company and keep those customers supplied with gas and electricity.

Stop saying people would be cut off. If the government hadn't stepped in and Bulb went bust, people still wouldn't be cut off. No one at the national grid is just going to start pressing buttons to shut things down.

Stop scaremongering.

Its an entirely academic discussion - as the bailout has occurred!

Of course if the market was going to deliver a solution to avoid the situation you are concerned about - why does the taxpayer need to provide any bailout? Presumably the market would just keep supplying Bulb customers for free indefinitely (as Bulb wouldn't exist to pay them) - because they are nice charitable caring people of course?

No one is ever going to be cut off - not because of the nice caring sharing suppliers but because the Government will never let it happen. That is why they have stepped in - because the free market has failed!

The free market failed? How on earth is a government price restriction an example of a free market?

Honestly, did you think about that before you typed it out?