Energy Supplier Failure: Transfers, Credit Balances and Debt

At a glance

  • Supplier failure does not normally interrupt your gas or electricity supply; Ofgem can appoint a replacement supplier in Great Britain.
  • Household credit balances have protection under the safety-net arrangements. Business balances do not have the same guarantee.
  • Keep readings, bills, payments and correspondence so the final and opening accounts can be reconciled.
  • Existing debt does not automatically disappear, and a new tariff may differ from the old contract.

When an energy supplier stops trading, keeping the supply running and settling the old account are related but separate tasks. A successful transfer does not mean every balance will immediately appear on the new account.

This guide concerns Great Britain’s arrangements. Ofgem’s response to a particular failure, and the new supplier’s instructions, should guide the practical steps for that event.

On this page

What a Supplier of Last Resort does

Ofgem can appoint a replacement supplier, commonly called a Supplier of Last Resort or SoLR. Customers are transferred so that their supply continues. In exceptional cases, a supplier may instead continue operating under a special administration arrangement.

Ofgem explains the replacement-supplier process and what to expect. Do not arrange a fresh switch simply because the failure is announced; follow the transfer instructions. An already-started switch may be handled differently.

Keep using and paying for energy under the applicable arrangements. Supplier failure is not a period of free supply.

Make an account record promptly

If safe and practical, take a meter reading and photograph the display and serial number. Record the date. Save copies of recent bills and statements while the old account portal is available.

Keep a list of payments made after the last bill, along with tariff information and any complaint reference. If you cannot access a reading or the website, tell the new supplier what is missing and ask how it will establish the account.

Use contact details published through official channels. Be cautious of unexpected requests to send money or bank details to an unfamiliar account during the confusion.

Household credit balances

Ofgem’s safety-net arrangements protect household credit when a supplier fails. The replacement supplier will explain how the credit is handled. This may require the failed supplier’s records and a final account calculation, so it may not happen immediately.

The credit visible on an old dashboard is not necessarily the final amount. There may be consumption since the last bill, later payments or corrections. Ask for the calculation if the final balance differs from what you expected.

Protection should not be confused with an immediate cash refund of an unverified screenshot balance. Preserve the records needed to reconcile the amount.

Business credit balances

Business customers do not have the same guaranteed credit protection. A replacement supplier may agree to honour some or all business credit, but that should not be assumed.

Ofgem’s business guidance explains that businesses may need to claim from the failed supplier’s administrator. Recovery can depend on the insolvency and may be less than the balance owed.

Ask whether your particular balance is covered by the transfer terms. If it is not, obtain the administrator’s verified claim instructions and any applicable deadline. Keep evidence of the amount and follow up on the claim; a supplier transfer is not the same as filing an insolvency claim.

What happens to existing debt?

A valid debt does not disappear because the supplier failed. The replacement supplier may take over customer debts; otherwise the old supplier or administrator may remain responsible for collecting them.

Before paying a new recipient, verify who is authorised to collect, which account the amount relates to and how it was calculated. Distinguish old-supplier consumption from energy charged by the new supplier.

If you dispute the amount, explain why and provide the evidence. An insolvency does not turn an incorrect charge into a correct one, but it can change which organisation must deal with it.

New tariffs and Direct Debits

The new supplier will explain the tariff and date it begins. The old fixed price is not necessarily preserved. Check unit rates, daily charges, payment arrangements and the opening reading.

Do not assume every Direct Debit should immediately be cancelled or that it will automatically transfer correctly. Follow the official instructions for the failure, check bank payments against the account and clarify any duplicate or unexplained collection.

After the transfer, ask about available tariffs or switching if needed. The rules for the transfer and deemed arrangements should be checked rather than inferred from the failed contract.

Reconcile the old and new accounts

Work through these checks:

  • Record the last confirmed old-account balance and the date it covered.
  • Add payments that were made but not reflected in that balance.
  • Check final consumption, rates, standing charges and adjustments.
  • Confirm the transfer reading and the date the new supplier took responsibility.
  • Check any credit or debt transferred and any separate refund or claim.
  • Make sure the same consumption has not been charged twice or omitted.
  • Request a written explanation of any difference.

For example, £300 shown as credit before £80 of unbilled consumption may become £220 on a correct final account, ignoring other adjustments. The smaller figure alone does not prove credit has been lost. Conversely, an unexplained difference should not be accepted without reconciliation.

Complaints and unresolved balances

Raise new-supplier billing or transfer errors with that supplier. Old-account or insolvency issues may need to go to the administrator. An earlier complaint may need to be raised again with the appropriate organisation; do not assume it transferred automatically.

Check the Energy Ombudsman’s scope before escalating. An ordinary live-supplier complaint and a claim in an insolvency are different processes, and the Ombudsman cannot be assumed to decide every administrator claim.

Keep a dated log of contacts and requested actions. This is particularly useful where several organisations are involved and each holds a different part of the account history.

Sources and further reading

Browse the Hub: Household resources · SME resources

Contributors

Scroll to Top