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Bulb collapses into 'special administration' – what it means for your gas and electricity

Bulb collapses into 'special administration' – what it means for your gas and electricity

Bulb, which supplies more than 1.7 million households, has collapsed into a so-called 'special administration', becoming the largest firm to fail during the current energy crisis. This process, which hasn't been used before in the energy market, means Bulb will continue to operate as usual for existing customers for now. But it's no longer taking on new customers and its future as a company is uncertain.   

If you're a Bulb customer, you don't need to do anything and nothing will change for now. We've full info on what it means for you below, plus some thoughts from founder Martin Lewis...

The info below only applies to domestic (household) customers; the rules are different if you're a business customer – you'll need to check directly with Bulb what it means for you. 

Your supply will continue as normal

While Bulb has collapsed, the special administration process means customers should not notice any changes for now. So your gas and electricity supply will continue, you can use your online account, contact Bulb's customer services, and you'll see Bulb's name on your bills. If you're on prepay, you can also continue to top-up as usual.  

You'll pay the price cap rate – so DON'T switch or you may pay more

Your price won't change for now and Ofgem says the administrator’s role will be to ensure energy supplies continue at the lowest cost that it is reasonably practicable to incur. 

Bulb only offers one variable tariff for credit meter customers and one for prepay customers; both priced at the maximum allowed under energy regulator Ofgem's price cap. Due to the energy market crisis, with wholesale prices (what providers pay) at record highs, there's nothing cheaper than this right, so don't be tempted by firms telling you to switch or you may pay 30%+ more - simply do nothing

If you were already in the process of switching to or from Bulb, this will proceed as planned.  

Don't cancel your direct debit

It's important not to cancel your direct debit payment. Bulb will remain your supplier and will continue to charge you at your current rate for now. 

If you do cancel your direct debit, you may end up paying more as the energy price cap is lower for those paying by direct debit compared to other methods of payment. 

Take a meter reading and screen grab your latest statement if you can

You can continue to access your account online for now, though Bulb's website might be slow today following the news. So when you can, download or take a screen grab of your latest statement and any credit amounts just in case you need these as proof to show a new supplier or the administrator later down the line. You may also want to take a meter reading.

When firms fail, the websites are often shut down, so as a precaution it's good to grab the info now. 

Energy credit is protected - even if you left Bulb recently

You may be owed money by Bulb if your account had built up credit. But Ofgem says this will be protected under the special administration process. If you're an existing customer, the credit will stay on your account and you can use it pay for future energy use or request a refund as normal.

If you've left the firm but you're owed credit, Bulb (or the administrator) will still pay this to you. 

If you owe Bulb money you'll still need to pay it back

If you're in debt to Bulb you will still have to pay this back, although it isn't clear how this will work in practice. It may be that you'll need to pay it back either to Bulb or to the administrator once appointed. We'll update this story when we know more. 

Special administration is different to what usually happens when an energy supplier goes under

A 'special administration regime (SAR)' is different from the usual process when a supplier goes under. Normally, a 'supplier of last resort (SOLR)' is put in place by energy regulator Ofgem to take on customers of a failed supplier. Since September alone, 19 domestic energy suppliers (excluding Bulb) have gone bust amid record wholesale costs (what energy firms pay).

But Bulb is the biggest energy provider to fail so far, and if a single supplier took on all of its customers, the cost of supplying energy and honouring credit balances would be a big risk.

The special administration regime instead enables Ofgem to appoint an administrator to run the company until Bulb is either rescued (ie, through restructuring), sold, or until it's transferred all of Bulb's customers to other suppliers. The scheme is specifically designed for the failure of large suppliers. 

Ofgem has yet to appoint an administrator, but once it does, it will be up to that administrator to run the company and to decide its fate. The administrator will, however, still be subject to the same rules that govern all energy suppliers, so you'll still be protected by the price cap, for example. 

What does Bulb say?

A Bulb spokesperson said: "We’ve decided to support Bulb being placed into special administration, which means it will continue to operate with no interruption of service or supply to members. If you’re a Bulb member, please don’t worry as your energy supply is secure and all credit balances are protected."

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