ENERGY company Daligas has ceased trading “due to the unprecedented energy market conditions”.
It’s the third supplier this week to fold because of the rising wholesale cost of energy.
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Pure Planet and Colorado Energy collapsed on Wednesday leaving a combined 250,000 customers without a provider.
They will be moved to a new supplier and won’t be cut off under the energy regulator Ofgem’s rules.
But they face higher energy bills and extra costs could also be passed onto all energy customers next year.
Daligas is a small energy company with around 9,000 customers and they will be protected in the same way.
Ofgem said customers of the supplier will also have any credit balance protected and that they will be protected by the energy price cap when they are moved to a new supplier.
Neil Lawrence, director of retail at Ofgem, said: “I want to reassure affected customers that they do not need to worry: under our safety net we’ll make sure your energy supplies continue.
“If you have credit on your account the funds you have paid in are protected and you will not lose the money that is owed to you.”
The energy price cap limits how much you’ll pay when on a standard variable rate (SVR) tariff for dual fuel (gas and electric).
The cap increased by £139 to £1,277 at the start of October and could rise again next April.
Fixed tariffs are normally less than the cap, but rising wholesale energy costs have sent prices soaring and they are now hundreds of pounds higher.
It means most billpayers are likely to be in the unusual position of being better off staying on the SVR rather than switching.
Many customers whose energy company went bust were on cheap fixed deals with low prices locked in before the recent rises.
They will face higher bills because they won’t get the same deal when they are moved to a new supplier.
The latest collapse follows warnings at the start of the week that four energy suppliers were on the verge of going under this week.
Wholesale gas prices have risen more than 250% since the beginning of the year, creating a strain on the UK energy industry that has toppled many suppliers.
Small energy firms Green and Avro ceased trading last month, leaving a combined 835,000 customers without a supplier.
Utility Point and People’s Energy also folded, along with a host of other small providers who have met the same fate.
At least 13 companies have now gone bust this year.
What to do if your energy supplier goes bust
If your supplier folds, your energy won’t be cut off, so there’s no need to panic.
Ofgem will arrange an interim supplier so you won’t have to go without.
Customers affected will be contacted by the new supplier, which will be chosen by Ofgem.
With the recent fall of People’s Energy, for example, Ofgem has appointed British Gas to take on supplying the provider’s 350,000 customers.
The new firm won’t have to honour the deal you were on with your previous provider but any credit on your account will be protected.
Experts like Martin Lewis’ MoneySavingExpert are advising customers not to rush to switch though, and instead “simply sit tight and wait to be contacted by a new supplier”.
But it is recommended that you take a meter reading ready for when your new supplier contacts you.
Other charities also recommend keeping old energy bills and waiting until your new supplier is appointed before cancelling any direct debits.
Energy price cap rise could leave more than five million households in the cold
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