Energy firms refusing to supply small UK businesses over bankruptcy fears

theguardian.com:

Major energy firms are refusing to supply small businesses out of concern that they could go bust, while some are demanding £10,000 up front, business owners and industry experts have told the Guardian.

In the latest sign of the deepening energy crisis, business owners said they were struggling to find a supplier in the run-up to the busy October period for renewing gas and electricity contracts, leaving them facing “extortionate” bills or demands for a deposit.

Suppliers named as having refused service, or asked for a downpayment, include SSE, Scottish Power, E.On Next, Drax and Ecotricity.

Business owners called for urgent action from the government, warning that sectors such as hospitality, which already struggling with inflation and the lingering effects of the Covid-19 pandemic, are at particular risk.

Teresa Hodgson, landlord of the Green Man pub in Denham, near Uxbridge, was initially told by her supplier SSE that it could not give her a quote for energy because prices were increasing so fast.

“When I did pin them down, they said before we can go any further, we want £10,000 deposit,” Hodgson said.

“When I asked why, because they’ve never had an issue with me, they said: ‘We don’t think a lot of pubs are going to make it this year and we need security.’”

“There were other suppliers who just wouldn’t entertain it at all because it’s hospitality,” she added.

Unlike households, businesses typically buy energy in contracts that last several years, often via a specialist broker that connects them with suppliers for a quote.

If they cannot find a fixed-rate contract, they move on to an out-of-contract “deemed” rate, which is uncapped and can soar in line with market prices.

Mark Dickinson, the chief executive of energy broker