An energy provider serving approximately 12,000 households is said to be on the verge of collapsing. Tomato Energy has submitted a notice of intent to appoint an administrator, as reported by The Sun. This legal action initiates a temporary freeze preventing creditors from pursuing legal measures for ten days. The filing occurred nine days ago following Tomato Energy’s accumulation of debts totaling £3 million and a prohibition from acquiring new customers imposed by energy regulator Ofgem in April. In case Tomato Energy fails to recover, it might face closure, and historically, Ofgem has facilitated the transfer of customers to alternative suppliers in such situations.
Recently, Ofgem cautioned that Tomato Energy could encounter a £1.5 million penalty for failing to meet financial obligations. If an administrator assumes control of Tomato Energy, efforts will be made to address the company’s outstanding debts. Notably, amid rising energy costs, the Ofgem price cap has been adjusted from £1,720 to £1,755 for a standard dual fuel household paying via direct debit. This cap remains effective until December 31, subject to subsequent updates. Customers on a standard variable rate (SVR) tariff are safeguarded by the Ofgem price cap unless they are under a fixed-rate contract. While the price cap limits charges for gas and electricity units, actual bills remain dependent on individual energy consumption levels.
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