Ministers have issued a stark warning following Octopus Energy’s takeover of collapsed supplier Bulb, explaining that consumers could still be hit with the bill from the deal.
According to Members of Parliament’s Public Accounts Committee, this could be as high as £6 billion, when combined with the other failures across the sector between 2021 and 2022.
Octopus is expected to repay some £2.96 billion of taxpayer money following the bailout of Bulb, which was completed late last year, ministers said in a report on Tuesday.
However, whether this actually happens remains to be seen, given the agreement rests on Octopus’s own resilience.
Some £246 million is also set to be borne by billpayers in relation to the deal anyway, alongside £2.7 billion from other supplier failures.
“While the government and regulators did the right thing in moving swiftly to protect consumers, the uncomfortable truth remains that the recovery of that investment hangs on the commercial success of one company,” ministers wrote.
Bulb was among almost 30 suppliers that collapsed between 2021 and 2022, as growing wholesale energy costs hit firms that had failed to hedge against higher prices.
As the largest company to go bust with around 1.5 million customers, Bulb was placed under government-handled administration following its collapse in November 2021.
Though the costs of this are said to have been lower than feared, the Public Accounts Committee urged the government to offer some clarity around Bulb’s public funding.
“The public can ill afford such uncertainty, particularly in challenging economic times,” Labour MP Meg Hillier said.