Scottish Power chief executive Keith Anderson who is the boss of one of the UK’s largest household energy firms, that “at least 20” more energy suppliers are facing bankruptcy.
Anderson told Sky New that the industry is bearing a £5bn bill and urgent changes are needed to the price cap which protects consumers from soaring bills.
The price cap was introduced by the former Prime Minister Theresa May to prevent consumers being ripped off with tariffs.
The more customers drop off from their fixed term tariffs and then go on to a cap regulated tariff which protects the consumers from the hefty wholesale prices.
If this continues to happen then within the next six months many more energy suppliers will cease to trade.
Anderson told Sky News, “The impact of that, if nothing else changes between now and then, we think you could see by that time the market return to five or six companies, and you could go all the way back to a new version of the Big Six.
“I don’t think that’s in the industry’s interest, it’s not in customers’ interest, and it’s not in the interest of the regulator either.”
Speaking to Ian King Live programme he said, “The cap needs to be much much more reflective of what’s going on in the marketplace.
At the end of the day, customers will end up paying for these much higher gas prices and we think the cap should reflect that more frequently than every six months and in addition to that… what I’m saying is there should be a special tariff…for the fuel poor and the vulnerable.”
Anderson added, “We think probably in the next month at least another 20 suppliers will end up going bankrupt.”
The energy watchdog, Ofgem said, “Ofgem is working closely with government and industry to ensure that customers remain protected.
“We have robust systems in place to ensure this.
“The price cap will remain in place this winter to protect millions of people from the sudden increases in global gas prices.
“We are also working with government to ensure that we have a sustainable energy market that works for all customers.”