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Effortless Energy becomes first small supplier to go bust during COVID

Effortless Energy becomes the second company to cease trading in 2020.

Effortless Energy becomes the second company to cease trading in 2020.

Effortless Energy has become the first supplier to go bust during the COVID-19 pandemic period.

Ofgem is now looking to choose a new supplier to take on the Stoke based company’s – which traded as Go Effortless Energy – 2,500 domestic and a small number of non-domestic customers.

Philippa Pickford, director of Retail at Ofgem, said: “Effortless Energy customers do not need to worry, as under our safety net we’ll make sure your energy supplies are secure and domestic customers’ credit balances are protected.”

She continued that the regulator will now choose a new supplier for all customers, who are advised to ‘sit tight’, and they will be updated when a new supplier is chosen.

Effortless Energy is the second supplier to cease trading this year, following GnERGY closing in March after it failed to pay £673,876.62 plus interest to the Renewables Obligation buy-out fund.

The last couple of years have seen a host of small suppliers cease trading, with Toto Energy closing in October 2019, marking the 16th since January 2018.

Criticism has been leveled at the costs of operating a small supplier in the current system by a number of the companies that have folded, along with other groups such as Power for People, an NGO hoping to tackle the ‘impossible’ costs and unleash community-owned clean energy.

While Effortless Energy may be just the second supplier to officially cease trading, a number of others have been struggling throughout 2020. This includes council owned suppliers such as Bristol Energy, with the council looking to sell its energy supplier given the “unprecedented challenges” it is facing.

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