Finance

Energy firms Whoop and Xcel Power stop trading ahead of Ofgem’s £693 price cap hike

The two energy firms supplied gas and electricity to homes and businesses, and affected customers are now being found new suppliers by the Ofgem energy regulator

Energy regulator Ofgem is now looking for firms to take on affected customers

Customers of energy Firms Whoop Energy and Xcel Power have been left adrift as the two firms have ceased trading.

Whoop Energy supplies 50 households and 212 businesses, while Xcel is used by 274 businesses.

A statement on the Whoop website said: “Whoop Energy is ceasing to trade. Ofgem, the energy regulator, is appointing a new supplier for its customers.”

Xcel Power said: “Xcel Power Limited is leasing to trade.”

Dozens of energy firms have gone out of business over the past year due to a rise in gas prices.

Due to a price cap set by Ofgem, energy suppliers cannot pass all of this cost on to consumers.

As a result, many energy firms are selling power for less than it costs them to buy it.

There has been another rise in gas prices this month.







Dozens of energy companies have been forced to stop trading over high gas prices
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Image:

AFP via Getty Images)

An Ofgem statement said: “In recent weeks there has been an unprecedented increase in global gas prices which is putting financial pressure on suppliers.

“Ofgem is working closely with government and industry to make sure customers continue to be protected this winter.”

Ofgem director of retail Neil Lawrence said: “Ofgem’s number one priority is to protect customers. We know this is a worrying time for many people and news of a more efficient going out of business can be unsettling.

“I want to reassure affected customers that they do not need to worry, under our safety net we’ll make sure your energy supplies continue.”

Ofgem’s advice to affected customers of Whoop and Xcel is to:

  • Wait until a new supplier has been appointed and you have been contacted by them in the following weeks before looking to switch to another energy supplier.
  • Take a meter reading ready for when your new supplier contacts you.
  • This will make the process of transferring customers over to the chosen supplier and honoring any funds that domestic customers have paid into their accounts, where they are in credit, as smooth as possible.

Millions of households will see their energy bills hiked by almost £700 from this April, Ofgem has confirmed.

Those on default tariffs paying by direct debit will see an increase of £693 from £1,277 to £1,971 from April 1 – an eye-watering rise of around 54%.

Prepayment customers will be worst hit, with an increase of £708 from £1,309 to £2,017.

The move will affect some 22 million households and follows a 12% rise in October.

It will affect default tariff customers who haven’t switched to a fixed deal.

It also affects those customers who remain with their new supplier after their previous supplier stopped trading and left the market.

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