They're falling like ninepins and, at first face, it's hard to see why another supplier of residential energy services has its face up against the wall. Utility Point, which had risen to a heady 15th in the list of UK energy suppliers (including the offices of the NTI newsroom in Tower Hamlets, where Billy has tapped into the supply to the prosthetic limb factory in the adjacent property and we get our energy for free) are closing down services today (Wednesday 15 September), having been advised by Alvarez & Marsal that there is no alternative. Utility Point enter the Supplier of Last Resort process today, which sounds a little like a sequel to the Lord of the Rings.
Last week we reported on this very site that PfP and Money Plus had gone down and it is just another day in the cut-and-thrust energy business today.
Utility Point blame their situation on "current global events coupled with the ongoing COVID-19 situation (which) has been a significant challenge and understandably so". Then they get a little more technical saying: "Pessures will continue to rise in the market as wholesale energy prices have soared to record levels from what has been a 99 percentile move off the back of an increase in extreme weather conditions leading to a global gas supply shortage, inability to provide timely and necessary generator maintenance causing multiple sites to be taken offline simultaneously, lower exports from Russia and rising demand."
Hmmm, is this a little like, "my dog ate my homework just before our house burnt down, we were raided by aliens who took my sister and - to cap a really annoying day - radon gas made my baby brother turn yellow"? However, we got the impression from the corporate statement that things are not good in the supply of domestic energy business.
You may have read last week that coal-fired power stations have been asked to start up again to cover unprecedented demand, and prices in the UK have recently hit over 157 pence per therm, compared to less than 30 pence per therm one year ago. Power prices closely follow the gas price and have climbed to an unprecedented level of over £540 per MwH. This is more than four times their normal level over the past decade. Power is expensive; just ask Dave Cameron.
It is no fun shutting your doors and letting everyone go at your company, but I hope you can join us at NTI in a wry smile when hearing that Utility Point's CEO is called Ben Bolt.
