© AFP
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Source: BELGIAN
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More than 1.5 million British households have now had to find another energy supplier. Two smaller British energy companies went bankrupt on Wednesday due to high energy and gas prices. This brings the total since the beginning of August to seven. Avro Energy, which went bankrupt on Wednesday, had nearly 600,000 customers alone.
The sharply rising energy prices are causing problems in the British energy market. It is possible that even more companies will not survive the current situation. “If you thought you could buy energy for 50 pence and pay 150 pence instead, your finances will take a huge hit,” explains energy consultant Niall Trimble.
In the United Kingdom, it has been arranged that other energy companies take over the customers of bankrupt peers. In doing so, the government sets a maximum for the increase that may yield to customers. Because the large energy companies are also affected by the high purchase prices, it is not interesting to take over customers. The government is willing to offer loans to energy companies to cover the extra costs of taking over customers.
It was announced on Tuesday that several smaller British energy companies are no longer taking on new customers. The companies offer lower prices to customers than they have to pay themselves and therefore it is not profitable. Smaller companies also have fewer financial reserves to absorb these setbacks.
There was also a crisis meeting between the British government and small energy companies on Tuesday. By the end of the afternoon, five of them indicated that they were no longer processing applications. The British regulator also demanded that five energy companies pay arrears to the government and three others were warned because they had not provided enough collateral to buy the necessary energy.
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