Breeze Energy, which won accolades for its customer service, has ceased trading.
The Newcastle-based firm, which served 18,000 customers in the North East, is the 17th energy supplier to fail since the beginning of 2018 and the ninth this year.
Just last week, Breeze Energy topped Citizens Advice’s rankings of the best energy firms for customer service for the second quarter in a row. It earned five star ratings for lack of complaints, ease of being contacted, clear and on time bills, and ease of switching, for an overall rating of 4.8.
Breeze Energy was founded four years ago by husband and wife team Kelly and Danny Hughes and co-founder James Platania, with a commitment to customer service.
"Danny and I are great believers in what is often disparagingly described as 'old fashioned customer service,'" Kelly said in October. "We aim to answer the phones in less than a minute and you'll get straight through to a customer service agent; no waiting in a queue or having to trawl your way through an automated menu system."
The firm employed 11 staff. And rather than offer attention-grabbing cheap tariffs, Breeze offered simplicity: just one fixed-rate tariff for gas and electricity.
However, Breeze failed to make its Renewables Obligation payments this year, suggesting financial difficulties. Last month Ofgem ordered the firm to pay £486,200, plus interest, into the fund and threatened to revoke its supply licence if it failed to do so.
That debt appears to have pushed Breeze Energy into credit default.
Breeze Energy customers will be assigned to a new supplier by Ofgem in the coming days.
Philippa Pickford, Ofgem’s Director for future retail markets, said: “Breeze 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.”
Breeze Energy’s debt to the Renewables Obligation fund was already part of the £97.5 million shortfall in the fund that was mutualised across all energy suppliers—and thus spread across all consumers’ bills.
Last month Citizens Advice estimated that the string of failures in the energy market had cost households £255 million, largely in unpaid industry bills, including into the RO fund.
Furthermore, more than one million customers have been directly affected the failures, which often see them waiting months for the return of their credit balances or hounded by administrators—not bound by Ofgem rules about
There’s some suggestion that the rash of failures of small suppliers is making consumers wary about switching to them and driving some households back to the Big Six. In October, more than 100,000 customers moved to a Big Six supplier from a smaller challenger.
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