Tomato Energy, a gas and electricity company, has gone out of business, prompting the regulatory authority in the sector to intervene and safeguard the energy provision for 15,300 households and 8,400 businesses.
Following the accumulation of £3 million in debt and a ban on acquiring new customers in April, administrators were appointed at the close of October. With no viable rescue plan in place, Tomato Energy is now ceasing operations. However, Ofgem has assured that the energy supply for its numerous customers will not be disrupted.
Rohan Churm, the director responsible for financial resilience and control, emphasized that Tomato Energy customers need not be concerned. Any existing credit on domestic customers’ accounts is safeguarded by Ofgem regulations. Efforts are underway to swiftly designate a new supplier for all current customers, who are advised against switching providers in the interim. Once a new supplier is selected, they will be contacted with further details.
Ofgem will communicate with Tomato Energy customers to notify them once a new supplier is appointed to assume the energy supply. Customers will be placed on a “deemed” contract, which may entail higher costs but can be terminated at any time.
In response to the rising number of energy companies going bankrupt, energy suppliers are now mandated to maintain a financial safety cushion. While fewer companies have folded since the implementation of the new regulations, Churm acknowledged that occasional failures are inevitable in a competitive market. The primary focus remains on safeguarding consumers in the event of such occurrences and minimizing associated expenses.
