What should I do if my energy company goes bust?

An unscrewed lightbulb lying on its side, symbolising an energy company gone bust

Your energy supplier going bust sounds scary, but you should be protected and won’t lose your supply. Here’s what you need to know.

The last few years have been rocky for energy suppliers. Over 50 energy companies have gone bust in the UK since 2018, due to rocketing wholesale costs.

Nowadays when you do an energy comparison, the choice isn’t quite as broad, with 37 suppliers currently operating in the UK. High-profile companies which have folded include Avro Energy, Igloo Energy, Together Energy and – in November 2021 – the UK’s then sixth largest energy firm, Bulb.

Is your energy company at risk? To help you understand what you can do, we answer the most common questions on what to do if your energy company collapses.

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What shall I do if my energy company goes bust?

If you’re told your energy company is closing down, first of all, don’t panic. You won’t be left without gas or electricity.

Ofgem, the energy regulator, will move you to a new supplier. It appoints what’s called a supplier of last resort (SoLR) to take on the customers of the failed suppliers.

For example:

  • Hub Energy and Igloo Energy customers were moved to E.ON.
  • Avro Energy and Bulb customers were moved over to Octopus Energy.
  • Green, Pure Planet, Colorado Energy and Daligas customers were transferred to Shell Energy.
  • Utility Point and Green Network Energy customers were switched to EDF.
  • Together Energy, Simplicity, PfP Energy, People’s Energy and MoneyPlus were transferred to British Gas.
  • Entice Energy and Orbit Energy customers were transferred to Scottish Power. 

If your energy firm goes into administration, you don’t have to do anything. It’s the regulator’s responsibility to move you. If you try to switch yourself, you risk losing your credit balance.

What Ofgem can’t guarantee is that the new provider will offer you an equivalent tariff. The new supplier will put you on a special ‘deemed’ contract. This’ll be a deal you haven’t chosen but will be covered by the energy price cap.

If you want to stabilise your energy bills, you could look into whether you should fix

Once your new provider is in place you can choose to switch. Don’t forget to cancel your direct debit with your old supplier.

What happens if my energy company goes into special administration?

Special administration means the government, via regulator Ofgem, will temporarily nationalise the energy firm. It means taxpayer cash – tens of millions of pounds – will be used to prop up the company until a long-term solution is found.

This happened when Bulb went under, as it was too big for any other energy supplier to take customers on right away under the normal process.

Much like if your energy company goes bust, there’s nothing you need to do. Your accounts will be taken care of, and you won’t lose your supply.

My energy company has gone bust and I was in credit. Will I lose that money?

No. There are guarantees that protect your credit balance. You start with that when the new supplier takes over.

It’s a different situation if you’re in debt with your old supplier. The new supplier may take you and your debt on. But if they don’t, the agency that deals with your old supplier’s bankruptcy may try to get it from you at a later date.

It’s worth noting that if you’re in energy debt, there may be support you can seek out. Talk to your provider if you’re struggling with making payments. They will talk you through options and can offer advice. Debt advice charities such as StepChange also offer free, impartial guidance. 

You can also see what help is available with your energy bills. There could be hardship funds to help subsidise bills for those who are struggling, for instance. Also, look to see if you qualify for the Warm Home Discount, Winter Fuel Payments or Cold Weather Payments.

I think my energy company might go bust. What shall I do?

If you think your energy provider is at risk of collapse, take photos of your meters, submit meter readings online, download bills and screenshot your credit balance. This should help with the accuracy of your switch later and clear up any potential future complications. 

Even if you don’t think your energy provider is at risk, it’s not a bad idea to take regular screenshots of your account. If it does go bust, the company’s website goes offline, meaning you won’t have a record anymore. It’s worth keeping records of your account in case you need to prove your record of past credit.

Should I switch to a new fixed-rate deal?

This is a difficult question to answer. If you fix now and wholesale energy prices suddenly drop (so fixes get cheaper in the future), you’ll have moved onto a fixed deal to only lose out. If you don’t fix now and prices rise then fixes could get more expensive.

You can compare energy deals to see what’s available and weigh up your options. See also whether energy prices will fall in 2024, and should you fix?

Will I still get the Warm Home Discount if I change supplier?

The Warm Home Discount gives millions of people £150 off bills to help with their energy costs over winter. 

You have to be over 62 and on certain benefits or on a low income. If you’re 62 and on pension credit and your supplier goes bust, you’ll get the discount automatically.

If you’re part of the broader group which is normally eligible for the discount and your supplier goes bust, you’ll be moved to a new supplier. But all suppliers with over 1,000 domestic customers are obliged to offer the Warm Home Discount, so you’ll almost certainly still get it.

How can I lower the cost of my energy bill?