UK ENERGY CRISIS: GEUK’s DOUG STEWART COMMENTS:
20th SEPTEMBER
Doug Stewart, Chief Executive of GEUK: “Firstly, GEUK is not involved in any talks regarding energy supplier bailouts; we have proactively hedged forwards to mitigate the current market risks.”
“And with regard to the current situation, it’s clear that the “cheapest price” business model is unravelling with multiple suppliers at risk. Ofgem’s so called ‘Robust Measures’ involve persuading another energy supplier to take on the customers and passing the costs of doing so onto those established and more prudent suppliers (and their customers) who remain in business. However with the current market as it is, the cost of taking them on without a hedged position to cover the usage of their customers is prohibitive.”
“The so-called ”safety net” has been a reward for such failure since it was introduced, despite many in the market calling for stiffer stress testing. For many years, GEUK called on Ofgem and the Government to have stronger stress tests for new entrants but these calls were ignored, until last year. This unfortunate situation has been coming for a while; people shouldn’t be surprised. Simply, you can’t buy something for £10 and sell it for £8 and expect to stay in business for long. The upfront payments taken from customers for their energy by some of these suppliers have disguised the amount of cash reserves that these suppliers actually have; energy suppliers racking up losses year on year simply isn’t sustainable.”
“Politicians, Ofgem, parts of the press and even some consumer groups have got to take a share of responsibility with their misguided mantra of ‘switch to the cheapest tariff’ without properly considering the true economic effect. The collective balance sheets of those suppliers deemed to be at risk have eyewatering negative values yet contain millions of pounds of customers’ cash.”
End.
Footnote: GEUK are the UK's only supplier of 100% green gas as well as 100% renewable electricity. For 20 years (since 2001), GEUK have championed the production of green energy in the UK and are committed to providing a high level of customer service; ensuring customers are able to reach a real person when they call us, and provide our customers with easy to understand bills.
Our customer promise states that we will never put artificial intelligence at the heart of our business - and we will always bill our customers in arrears - meaning customers will not be billed until GEUK have supplied the energy. This is all integral to our sustainable business model, ensuring we are here tomorrow to live up to the promises we make today.