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Ovo Agrees to Take on Economy Energy’s Customers

energy-ofgem

Ofgem has appointed Ovo Energy to take on the 235,000 Economy Energy customers affected by the independent supplier’s closure last week.

Economy Energy became the ninth energy supplier to cease trading in the last year, following weeks of uncertainty and speculation that its future was in doubt. Just a week before closing down, the firm was banned from taking on any new customers after receiving large numbers of complaints over the last year. They were ordered to not take on any new customers until their customer service had significantly improved.

Dozens of low-cost independent energy companies have been launched in the last few years following a drive to increase competitiveness in the market. However, increasing wholesale costs in the last year have caused a growing number of independent firms to go out of business.

After the latest collapse, Ofgem reassured any Economy Energy customers that any outstanding credit balances will be honoured, including any money owed to former customers. Existing customers of Economy Energy will be automatically transferred over to Ovo Energy’s standard variable tariff – ‘Simpler Energy’.

A spokesperson for Ovo Energy said: “This is a good outcome for Energy Economy customers who have had an uncertain few weeks. We are very pleased to welcome these customers to Ovo. If you are an Economy Energy customer, please wait for us to contact you once your new account has been set up.”

Ovo has said they are now supplying around 1.5 million customers in the UK, after also taking on the 290,000 Spark Energy customers, another independent firm that went bust in November last year. The latest data from Ofgem has shown that Ovo Energy now has a 3% market share overall. Other independent energy suppliers that have ceased trading over the last year include Extra Energy, Future Energy, National Gas and Power, Iresa Energy, Gen4U, Usio Energy and One Select.

“I am pleased to announce we have appointed Ovo Energy, which will offer Economy Energy’s customers a competitive tariff for their energy,” said Philippa Pickford, director for future retail markets at Ofgem. “Their credit balances will be honoured and their energy supply will continue as normal. Ovo Energy has also agreed to absorb the costs of taking on these customers and outstanding credit balances, which means the extra costs will not fall on the industry or households. Ovo Energy will be in contact with customers over the coming days with further information. Once the transfer has been completed, customers can shop around for a better deal if they wish to.”

Ofgem also confirmed that any customers who want to switch energy suppliers will not have to pay any exit fees. It has also been confirmed that any Warm Home Discount customers – people who are living in fuel poverty - will continue to receive financial support from Ovo Energy.

Fergus Cole
Fergus Cole

Fergus is a journalist specialising in the personal finance, energy and broadband sectors. He also has a passion for travel and adventure so tries to make the most of this in any spare time he gets.

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