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The energy crisis and soaring wholesale power and natural gas prices claimed its biggest victim so far in the UK when Bulb, a power and gas supplier serving 1.7 million customers, said on Monday that it would enter into special administration.
Bulb, the supplier founded in 2015, became the latest in a series of some 20 energy providers in the UK that were forced to exit the retail energy market amid unsustainably high wholesale prices for natural gas and electricity.
Gas and electricity prices have surged in recent months in the UK and the rest of Europe amid an energy crunch that sent prices spiking and boosted inflation.
Since the energy crunch began in September, more than a dozen power and gas suppliers in the UK have exited the retail energy market, and more are likely to do so. Another 20 energy providers in the UK could go bust in what looks like a “massacre” in the coming months unless the government reviews the energy price cap, Keith Anderson, chief executive at one of the largest providers, ScottishPower, said last month.
In a statement on Monday explaining its decision to enter special administration, Bulb said that while searching for fundraising options, “the rising energy crisis in the UK and around the world has concerned investors who can’t go ahead while wholesale prices are so high and the price cap—designed to protect customers—currently means suppliers provide energy at a significant loss.”
“Wholesale prices have skyrocketed and continue to be extremely volatile. The gas supply shortage combined with lower exports from Russia and increased demand means they remain high and unpredictable,” the company said.
Bulb’s businesses in France, Spain, and Texas will continue trading as they are separate businesses from Bulb UK and are not immediately affected by it entering special administration in the UK.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.