Collapse of Bulb demonstrates failure of energy price cap
22 November 2021
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Energy and Environment
Andy Mayer comments for City AM
22 November 2021
Coronavirus
Lifestyle Economics
15 November 2024
Commenting on reports that Bulb Energy has fallen into special administration, Andy Mayer, Environment, Energy and Infrastructure Analyst at free market think tank the Institute of Economic Affairs, said:
“The collapse of Bulb, Britain’s seventh largest retail energy company is a direct result of government policy, specifically the energy price cap.
“This is the twentieth British energy company to fail since global gas prices rose sharply this year, yet the government persists in this policy, while promoting a fiction of fairness and control through central planning that has real consequences. The result is a £400 per customer difference between wholesale and retail prices, multiple business failures, and temporary state ownership of an insolvent business.
“Bulb’s customers will be protected, through the Special Administrator Regime, but their creditors and investors will suffer, leading to a wider loss of confidence in energy concerns.
“Who would choose to invest in a market where the government has shown a willingness to let companies go to the wall rather than break political promises on prices they cannot keep? Prices are going to have to rise regardless, but the damage will already have been done. It is time to end the price cap.”
ENDS
Notes to editors
Contact: Emily Carver, Head of Media, 07715 942 731
IEA spokespeople are available for interview and further comment.
“The collapse of Bulb, Britain’s seventh largest retail energy company is a direct result of government policy, specifically the energy price cap.
“This is the twentieth British energy company to fail since global gas prices rose sharply this year, yet the government persists in this policy, while promoting a fiction of fairness and control through central planning that has real consequences. The result is a £400 per customer difference between wholesale and retail prices, multiple business failures, and temporary state ownership of an insolvent business.
“Bulb’s customers will be protected, through the Special Administrator Regime, but their creditors and investors will suffer, leading to a wider loss of confidence in energy concerns.
“Who would choose to invest in a market where the government has shown a willingness to let companies go to the wall rather than break political promises on prices they cannot keep? Prices are going to have to rise regardless, but the damage will already have been done. It is time to end the price cap.”
ENDS
Notes to editors
Contact: Emily Carver, Head of Media, 07715 942 731
IEA spokespeople are available for interview and further comment.
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