Thousands of households risk being placed on the most expensive electricity and gas tariffs as more suppliers flee the Irish market.
anda Power, which has around 60,000 residential electricity and gas customers, is said to be about to leave the residential supply market.
It would become the latest victim of the energy crisis – which has already seen three other suppliers withdraw from this market.
When energy suppliers leave, their customers are transferred to “suppliers of last resort”.
This means that they are subject to the most expensive “standard tariffs”. These are up to 30% higher than the best rates that can be obtained from energy suppliers by committing to a discounted annual contract.
Any customer whose supplier leaves the market is encouraged to switch to an existing player as soon as possible.
Daragh Cassidy of price comparison site Bonkers.ie said Panda Power was set to become the fourth supplier to leave the Irish market in the space of months after Glowpower, Bright Energy and Iberdrola.
“It’s likely that more vendors will fall over the next few months,” Cassidy said.
After the recent price hikes, the average customer ended up paying around €2,500 a year for their electricity and €2,000 for their gas
A spokesman for the energy regulator, the Utilities Regulatory Commission (CRU), said it was “engaging with an energy supplier in relation to its participation in the market”.
The huge increase in wholesale energy prices since Russia’s invasion of Ukraine has constrained dealers like Panda Power, making it very difficult for them to make a comeback.
Panda Power only increased its electricity and gas prices in August. Electricity prices increased by 12.7% and gas prices by 25.8%.
This was Panda’s second price increase this year, as it also increased its prices in May.
Last year, it increased electricity prices fivefold and gas prices fourfold.
After the recent price hikes, the average customer ended up paying around €2,500 a year for their electricity and €2,000 for their gas.
The company, part of Beauparc Utility Group, only entered the energy supply business here in 2018.
Beauparc changed hands in a deal worth around €1bn last year.
Panda’s waste recycling business has forced double-digit price hikes on households this month. Panda Recycling, which has 360,000 residential customers, has increased bin lifting fees by more than 12% and is also increasing its service fees. The company blamed an increase in the cost of the diesel needed to power its trucks.
If Panda Power leaves the market here, its customers will not lose their supply.
But the CRU will initiate the ‘provider of last resort’ procedure, which will see the remaining Panda electricity customers transferred to Electric Ireland to ensure their supply is not interrupted. Gas customers will be moved to Bord Gáis Energy.
Mr Cassidy said the news put an end to the populist narrative of imposing a windfall tax on all energy companies.
This proves once again that many energy companies are in trouble and that any exceptional taxes must be carefully studied and targeted to ensure that they do not cause more carnage.
The CRU said it could ‘confirm that it has engaged with a supplier in respect of its continued participation in the energy supply market’.
He added: “When a supplier seeks to exit the market, the CRU initiates the supplier of last resort process. As part of this process, the CRU receives representations from the supplier who wishes to cease supplying customers and leaving the energy supply market(s) and the CRU makes a decision on whether to engage providers of last resort.
“Through this process, the objective of the CRU is to agree on an appropriate timetable to protect the interests of customers in their choice to switch suppliers and to ensure the continuity of supply by suppliers of last resort.
“Until these discussions are complete, it is not possible for CRU to provide further details.”