AROUND a quarter of a million customers of a collapsed Coventry energy firm are being switched to another supplier after it entered administration with 50 job losses.
Joint administrators from Grant Thornton UK LLP were appointed to Economy Energy on January 14 after the company collapsed.
It follows energy regulator Ofgem preventing the firm from taking on new customers after concerns about refunds, payments and ‘unacceptable’ service.
The administrators announced 49 of the gas and electricity company’s 193 staff members will be made redundant.
It remains unclear what will become of the other employees.
Meanwhile Ofgem appointed Ovo Energy to take on supplying the firm’s 235,000 domestic customers, and paying money it owes.
Economy Energy, based in Friars House, Manor House Drive, near Coventry train station, has endured a torrent of complaints on review sites. The Observer has heard concerns from a number of elderly customers about refunds.
Advisory partner at Grant Thornton Eddie Williams said: “In common with a number of independent gas and electricity suppliers, Economy Energy has struggled over the last few months with a wide variety of challenges including a difficult wholesale market and a requirement to make significant Renewable Obligation payments which were due.
“As a consequence, future cash flows have meant that the business was not in a position to continue to operate.
“Our priority is to continue to work with Ofgem and Ovo Energy to ensure that any impact on customers is minimised and to undertake an orderly collection of outstanding balances due and realise any other assets of the company.
“The administration process is expected to be complex and is clearly at an early stage but unfortunately due to the current position of Economy Energy, 49 employees have today been made redundant.
“The remaining employees continue to be retained to support Economy Energy and that process.”
Ofgem’s director for future retail markets Philippa Pickford said: “I am pleased to announce we have appointed Ovo Energy, which will offer Economy Energy’s customers a competitive tariff for their energy.
“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.”
Economy Energy customers on a prepayment meter should wait for Boost to contact them and can find out more information by visiting: www.boostpower.co.uk/economy-energy, or contact them on [email protected] or 0330 102 7428.
Economy Energy customers who pay monthly should wait for OVO Energy to contact them and can find out more information by visiting: www.ovoenergy.com/economy-energy, or contact them on [email protected] or 0330 102 7407.
More information for Economy Energy’s customers can be found on the Ofgem website.
