Supplier start-up Rebel Energy has suspended the onboarding of further customers till 2022.
In a letter to stakeholders this week, the company’s CEO Dan Bates and COO Penelope Hope laid out the company’s strategic plans for its underlying business. This includes postponing its full customer launch until 2022 to allow market conditions to stabilise.
“We have already begun to scale back our operations to minimum overheads and to focus our attention on our technology platforms alongside securing our intellectual property,” they wrote. “Fine-tuning our systems and overarching structure will provide a robust foundation from which to scale in the new year.”
The decision follows string of small suppliers closing over the past month as power and gas prices skyrocketed. In October alone Goto Energy, Pure Planet, Colorado Energy and Daligas all ceasing to trade, following ten suppliers shuttering in September.
Power price spikes have been largely driven by a global gas shortage, which combined in September with reduced generation in the UK due to a number of outages and low winds. Prices have been steadily growing in recent months, with day-ahead wholesale prices averaging £126.14/MWh in Q3, up 69% from the previous record of £74.85/MWh set in just the previous quarter, according to recent research from EnAppSys.
High prices are expected to continue throughout winter as National Grid ESO has warned of tight margins through the period. With them, further supplier failures are expected – Omni Energy for example has already warned that it does not expect to make it through November.
Writing on LinkedIn, Bates stated that thanks to Rebel Energy’s recent investment round adding additional capital to its balance sheet it will be able to continue, adding his thanks to investor private members club the Beaufort Society.
In March, Rebel Energy raised 157% of its crowdfunding within a week, with more than £220,000 raised. The company was first unveiled in August 2020 by Bates – who worked at BP for 17 years previously – when the company partnered Blue Prism.
It initially targeted a launch date in the Summer, and in September announced plans to suspend customer onboarding as part of its Beta Trial
“When we deem conditions to be ripe we will re-enter the market in a more advanced form,” the stakeholder letter added. “However we expect the competitive landscape to look decidedly different and we hope to be able to profit from such an environment.”
Current± caught up with Bates earlier this year to discuss how this business model will work, and the opportunity available in the market for a young energy company.