Our Power falls into administration
Housing association-backed energy provider Our Power has ceased trading.
Directors at the not-for-profit company said the decision was taken “with heartfelt regret” and blamed a “very difficult” and “highly volatile” energy market.
Regulator Ofgem said the energy supply to the group’s 38,000 customers will not be affected and prepayment meters can be topped up as normal.
Our Power Energy, a subsidiary of Our Power Community Benefit Society, was founded in 2015 by 35 member organisations including some of Scotland’s largest housing associations, and local authorities.
The company aimed to save its members up to 10% on their household utility bills compared to standard commercial tariffs.
In 2017 it launched a Social Purpose Bond to allow it to increase its market share and deliver its social impact.
Our Power joins long list of small providers that have gone bust recently, including Economy Energy, Spark Energy, Extra Energy, Future Energy, National Gas and Power, Iresa Energy, Gen4U, One Select and Usio Energy.
In a statement circulated to its members, Our Power said: “It is with heartfelt regret that Our Power Board of Directors has taken the decision to close Our Power Energy Supply Ltd by taking the company into administration.
“Directors had no choice but to reach this decision as the requirement to bring working capital into the business outpaced our ability to improve revenue collection and raise funds.
“It is a very difficult time in the energy market including a highly volatile wholesale energy market which means that we have needed to post significant collateral with our energy wholesaler which has taken cash out of the business.
“This situation has been made worse by the number of suppliers that have experienced difficulties and have had to exit from the market. These failures have exacerbated the situation because of the impact they have had upon confidence in the wider sector.
“In addition to the external conditions, the impact of having to change CRM system and the time it has taken us to make progress with recovering cash through billing, direct debits and achieving customer payments has meant that the business is carrying too many costs without receipt of funds to cover this.
“The Leadership Team and Board of Directors have done their utmost to try to find a solution but have been unable to and reluctantly took the decision to close the business at the Board on 24th January.”
Ofgem will now choose a new supplier to take on Our Power’s customers as quickly as possible. This supplier will contact these customers shortly after being appointed.
Philippa Pickford, Ofgem’s director for future retail markets, said: “Our message to energy customers with Our Power is there is no need to worry, as under our safety net we will make sure your energy supplies are secure and your credit balance is protected.
“Ofgem will now choose a new supplier for you, ensuring you get the best deal possible. 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.
“We have seen a number of supplier failures over the last year and our safety net procedures are working as they should to protect customers.”