Each year, a number of new energy companies enter the market, and a number also go bust. In recent times, numerous local authorities have set up their own energy company in partnership with an existing provider.
Bristol City Council has just announced that Bristol Energy is now up for sale. In an arranged meeting taking place on 2nd June 2020, the cabinet agreed to sell the local authority-owned provider, Bristol Energy was founded back in 2015.
Marvin Rees, the current mayor of Bristol, said the firm has faced extraordinary challenges since it was brought into existence by his predecessor.
In early 2020, Ernst & Young, a professional services firm based in London was commissioned by the authority to conduct a full in-depth assessment of Bristol Energy’s structure and to see if the business model would remain viable in the future.
Bristol City Council will now search for a buyer for the energy provider. Mr Rees said that: “Establishing an energy company was always a high risk for the council, and one which has brought continued challenges.”
“The energy market is dominated by well-established far larger energy providers. Having inherited a failing company where £15 million had already been spent or earmarked for spend, we were faced with a choice. We could have closed the company then or tried to develop a business strategy that would succeed, both in tackling fuel poverty in Bristol and delivering a financial return for the city. This proved to be impossible in such a volatile marketplace.”
“We have tried to work in the best interests of the city and Bristol Energy customers but been unable to divulge the challenge we were tackling as this would have further disadvantaged us against competitors.”
Cllr Craig Cheney, Bristol council’s deputy mayor and cabinet lead for companies, said: “Selling Bristol Energy is in the best interests for the council and city tax payers.
“We have worked tirelessly to try and turn the company into something that is not only profitable but also offers more to citizens in terms of social benefit as this was always the vision when we took it on. Projects supporting this vision include buying energy directly from over 54 renewable generators, most of them community owned, and the Bristol Energy Fuel Good Fund which supports Fuel Poverty.”
Bristol Energy is one of the UK’s first municipal energy companies, due to being entirely owned by Bristol City Council. Its aim is to engage with local customers by offering them cheaper gas and electricity tariffs. The company hopes to have a positive impact on the city and is developing partnerships with the local community and organisations generating renewable energy.
Bristol Energy is part of the Warm Home Discount scheme, giving eligible customers a £140 discount on their electricity bill between October and April. Furthermore, the energy supplier was one of the first to volunteer to offer the discount to its customers.