Ofgem plans for Gazprom Energy takeover after customer exodus
The government has drawn up plans to take over the funding of the UK operation of the Russian energy giant Gazprom, should the state-backed supplier collapse as customers cut supply contracts due to the invasion of Ukraine.
Officials have drawn up contingency plans to implement a financial lifeline for the business energy supplier, which has contracts in place with about two-thirds of the UK’s heaviest gas users, in the event that Gazprom Energy enters administration in the next few weeks.
Gazprom Energy, which is facing a customer exodus following Vladimir Putin’s invasion of Ukraine, has tested the market’s appetite for a buyer as the company considers financial options.
If Gazprom were to fail, it would be put into taxpayer-funded special administration – as occurred with Bulb, Britain’s seventh-biggest residential energy supplier, in November – because it is too large to be handled by energy regulator Ofgem’s “supplier of last resort” process. Bulb remains in administration with a taxpayer loan of £1.7bn.
“We are aware that Gazprom Energy has a large presence in the non-domestic energy retail market,” said a government spokesperson. “Gazprom’s retail business continues to trade in the UK and customers should exercise their own commercial judgment with regards to energy supply contracts they have in place at the moment.”
The firm supplies 100,000 sites across the UK, Ireland, France and the Netherlands, with offices in London and Manchester and about 350 staff. It accounts for about a fifth of the energy consumed by UK businesses, including councils and the NHS, but its clients are concentrated in industries such as ceramics, glass and steel.
Earlier this month, the health secretary, Sajid Javid, said that the NHS in
Read more on theguardian.com
