Tomato Energy, based in Belvedere House in Basing View, announced on November 5 that it has ceased trading, no longer supplying energy to its 15,000 domestic customers and 8,000 non-domestic customers.
This comes after reports that the energy supplier had filed a court notice of intention to appoint administrators in October, following two £1.5m fines from Ofgem and information showing ‘its outstanding liabilities to over 35 creditors total over £12m.’
Rohan Churm, Director for Financial Resilience and Control at Ofgem, said: “We have worked hard to improve the financial resilience of suppliers in recent years, implementing a series of rules to make sure they can weather unexpected shocks. But like any competitive market, some companies will still fail from time to time, and our priority is making sure consumers are protected if that happens and that any associated costs are minimised.”
On October 13, Ofgem published a proposal to impose a £1.5m financial penalty for ‘breaching the standard license condition that requires it to obtain and maintain liquidity’ as it had not finalised agreements which would allow it to address ‘serious cashflow challenges’ and ‘meet its financial liabilities on an ongoing basis.’
This comes after a provisional order served in April, which banned the supplier from taking on new customers, due to more than £3m of debts, with the sales ban put in place until it was able to meet industry-regulated financial requirements.
In a separate investigation, starting November 2023, Tomato Energy was found to have ‘exposed customers to an increased risk of harm’ by incorrectly charging customers, failing to supply information promptly and having insufficient procedures to comply with regulatory obligations and operational capability.
On September 2, the supplier was also ordered to pay £1.5m to Ofgem’s Energy Industry Voluntary Redress Fund and make redress payments of between £10 and £50 to affected customers.
For Tomato Energy’s existing customers, Ofgem is appointing a new supplier and under The Supplier of Last Resort, their energy supply will continue and will be protected by the energy price cap when switched to a new supplier.
Rohan said: “I want to reassure Tomato Energy customers that they do not need to worry. They will not see any disruption to their energy supply, and any credit domestic customers have on their accounts remains protected under Ofgem’s rules.
“We are working quickly to appoint a new supplier for all existing customers, and they should not switch in the meantime. Once appointed, a new supplier will be in touch with further information.”
