Gas and electricity company Tomato Energy has gone out of business, prompting the regulatory body of the industry to intervene and ensure the continued supply of energy to 15,300 households and 8,400 businesses.
Administrators were brought in at the close of October due to the company accumulating £3 million in debts and being prohibited from accepting new customers since April. With no viable rescue plan in place, Tomato Energy is now in the process of shutting down. However, Ofgem has assured that the energy services for its numerous customers will not be disrupted.
Rohan Churm, the director overseeing financial stability and management, stated, “I want to assure Tomato Energy customers that there is no need for concern. Their energy provision will not be interrupted, and any credit balance held by residential customers is safeguarded according to Ofgem’s regulations.”
“We are swiftly working on appointing a new energy supplier for all current customers, and during this period, customers should refrain from switching suppliers. Once the new supplier is selected, they will reach out with additional details,” Churm added.
Ofgem will communicate with Tomato Energy customers to update them on the appointment of a new supplier to take over the energy provision. Customers will be placed on a “deemed” contract, which may entail higher costs but can be terminated at any point.
Following the collapse of 30 companies in under a year, energy suppliers are now mandated to maintain a financial safety net. Since the enforcement of these regulations, fewer companies have faced insolvency. Churm noted, “We have made significant efforts to enhance the financial resilience of suppliers in recent years by implementing a set of regulations to help them withstand unforeseen challenges.”
“However, in any competitive market, some companies may still go under occasionally, and our primary objective is to ensure consumer protection in such instances while minimizing any associated expenses,” Churm emphasized.
