Eversmart Energy, an energy supplier with around 29,000 domestic customers and a very small number of business customers has ceased to trade.
Under Ofgem’s safety net, the energy supply of Eversmart Energy’s customers will continue and prepayment meters can be topped up as normal. The outstanding credit balances of domestic customers will be protected. Ofgem will choose a new supplier to take on all of Eversmart Energy’s customers. This supplier will contact these customers shortly after being appointed.
Philippa Pickford, Ofgem’s director for future retail markets, said “Eversmart Energy customers do not need to worry, as under our safety net we’ll make sure your energy supplies are secure and domestic customers’ credit balances are protected. Ofgem will now choose a new supplier for you and whilst we’re doing this our advice is to ‘sit tight’ and don’t switch. You can rely on your energy supply as normal. We will update you when we have chosen a new supplier, who will then get in touch about your new tariff.”
Commenting on the collapse of Eversmart Energy, Peter Earl, Head of Energy at comparethemarket.com, said “Eversmart clearly hasn’t made many smart decisions since its recent launch into the energy market and now has the dubious distinction of being the 13th energy provider to collapse in the space of a year. The worrying trend of supplier collapses underlines the need for new entrants to the energy market to be thoroughly vetted. Only yesterday Ofgem published a report saying that overall customer satisfaction with their energy provider is trending down over time, and for Eversmart’s 29,000 domestic customers, their confidence has likely taken a battering. Fortunately, Ofgem has a system in place to ensure the smooth transition of Eversmart’s customers to another provider – but as this collapse demonstrates, in order to raise the public’s confidence in the energy sector it is essential that the process of supplying energy to customers is not a free-for-all.”
Eversmart Energy is sixth firm to collapse this year.
Gillian Guy, Chief Executive of Citizens Advice, said “Eversmart is the 13th domestic energy company to collapse in the last two years. Our research shows this unlucky baker’s dozen of failed companies has left behind at least £172 million in unpaid costs. These will be picked up by other consumers through higher bills. We’re also concerned that some customers may have high credit balances.
“Eversmart had a tariff which encouraged people to pay for a year’s energy upfront. We raised our concerns with Ofgem, and it’s since been withdrawn. When a supplier goes bust, customer credit balances are protected. But all of us will eventually pay for honouring them through increased bills.These regulations provide vital protection for those affected. However, it was never expected that firms would actively encourage very large credit balances.”
“Ofgem needs to act to reduce the cost of supplier failures and protect customers.”