Regulator Ofgem has appointed Ovo Energy to take on 290,000 Spark Energy customers after the latter’s collapse last week.
Spark Energy, which is based in Selkirk, ceased trading last Friday after being unable to pay £14 million to the Ofgem for not meeting their renewable energy obligations. It is the seventh energy company to cease trading this year in the UK.
Industry regulator Ofgem have approved a takeover from Ovo Energy, who will retain the Spark Energy brand and over 300 staff in Selkirk, Edinburgh and Horsham.
Customers will still to be contacted by Spark’s customer service staff and will continue to be billed under the company’s name.
“The energy sector is going through a major change and many companies, big and small, are struggling to adapt,” said Stephen Fitzpatrick, founder and CEO of Ovo. “We are delighted to have been able to bring Spark into the Ovo Energy Group, securing a good outcome for their customers and the team. We will combine Ovo’s innovative technology and focus on customer experiences with Spark’s unique network of partnerships to bring greater products and services to more households of the UK.”
Spark Energy’s customers will stay on the same tariffs as before, and any money owed in outstanding credit balances to either current or former Spark customers will be paid. Customers can still search for a better deal and switch energy suppliers, but Ofgem has suggested they wait until the takeover is completed to shop around.
“Their credit balances will be honoured and their energy supply will continue as normal,” said Mary Starks, executive director of Ofgem. “Ovo Energy, under the Spark Energy brand, will be in contact with customers over the coming days with further information. Once the transfer has been completed, customers can shop around for a better deal if they want to.”
News of the takeover was welcomed by Chris Gauld, the chief executive of Spark Energy.
“We will service our customers, under Ovo’s licence, from our existing offices, and continue to grow our niche model of partnering with leading letting and estate agent companies,” said Gauld. “I’m delighted that we can continue to grow as part of the Ovo family with a renewed confidence in the future despite the challenges the sector is facing.”
However, the £14 million debt owed to the regulator by Spark will not be taken on by Ovo. Ofgem have confirmed that the outstanding bill will be split between the other energy suppliers in the market.
Extra Energy also ceased trading last week, and their 108,000 domestic customers and 21,000 business customers were taken on by Scottish Power after approval from Ofgem. Energy supplies will also continue as normal for Extra Energy customers, and any outstanding credit balances will be honoured.
Ofgem also confirmed that they are investigating Economy Energy, another supplier that has failed to pay into the renewable scheme.