The UK energy sector has been decimated this winter with more than 20 companies collapsing since September, affecting around four million customers. According to accountancy firm Price Bailey, 14 suppliers are deemed to be at “maximum risk”, which puts them in danger of going under.
The report assessed the credit risk scores of all electricity and gas suppliers registered with the UK regulator Ofgem.
Since the findings were released, three firms have failed, including the seventh largest supplier Bulb, which announced plans to enter administration on Monday.
Price Bailey partner Matt Howard described the current situation in the energy market as “complete carnage”.
He warned the overall number of suppliers could fall below 10 and leave customers facing increased bills.
Meanwhile, some other experts believed the price cap could rise to around £1,600 next April.
Bulb, which has around 1.7 million customers in the UK, became the latest casualty of the market on Monday.
The firm said: “We’ve decided to support Bulb being placed into special administration, which means it will continue to operate with no interruption of service or supply to members.
“If you’re a Bulb member, please don’t worry, as your energy supply is secure and all credit balances are protected.”
Bulb has too many customers to be dealt with via the supplier-of-last-resort process, which simply moves customers from a failed company to another supplier.
Ofgem will now use a special administration process to find an administrator following the backing of Business and Energy Secretary Kwasi Kwarteng.
The administrator will continue to run the company until it can be sold off, the customers join another supplier, or it can be restructured.
Ofgem said: “Customers will see no disruption to their supply and their account and tariff will continue as normal. Bulb staff will still be available to answer calls and queries.”
Downing Street confirmed on Tuesday it has authorised British oil companies to release up to 1.5million barrels from their strategic reserves to ease pressure on energy prices.
The Prime Minister’s spokesman said it was part of a co-ordinated international move led by the US which is releasing 50 million barrels.