1.6m people's electricity will stay on thanks to Government's £1.7billion loan
The energy company entered special administration yesterday
The Government has set aside nearly £1.69 billion to allow Bulb to continue supplying energy to its customers as the energy company fell into administration.
In court on Wednesday (24 November), the company was put into special administration, which will allow it to continue to trade for the time being, ensuring that lights stay on for Bulb's 1.6 million customers.
The energy provider being in "special administration" means that it is run by the government through the regulator Ofgem.
Bulb will be run by administrator Teneo until a buyer can be found or until its customers have moved to another provider.
Court documents show that Business Secretary Kwasi Kwarteng can free up more money for the company if needed and that without the cash, Bulb would not have been able to keep its doors open past the middle of December.
Could cost up to £2.1 billion to keep trading
The administrators estimate that it will cost around £2.1 billion to keep Bulb trading until the end of April next year.
The company is three times larger than any other energy supplier that has failed in recent years. Normally Ofgem simply lets a firm fail and moves its customers to a new supplier.
At the High Court in London, Justice Adam Johnson said that the administration was designed "to keep the energy supply company going with a view to it being rescued if that is possible".
He added that an alternative was to appoint a supplier of last resort, adding: "That is thought to be impractical here given the size and importance of Bulb as a supplier".
The judge said that the £1.7 billion would be "of existential importance to Bulb".
Bulb chief executive Hayden Wood was at the hearing on Wednesday. He declined to comment.
What should I do if my provider goes bust?
If your energy provider goes bust, you will still receive gas and electricity.
Energy regulator Ofgem will move your account to a new supplier, however you can't chose the provider and may end up on a more expensive tariff.
It is recommended by Citizens Advice to make note or take a photo of your meter reading and download any bills, while waiting for your new supplier.
There's no need to cancel direct debits before your new account is set up.
"Systemic failure of regulation"
Shadow business secretary Ed Miliband said: "With so many companies going bust in just two months, something not happening anywhere else in the world, it points to a systemic failure of regulation. Firms took risky bets and were allowed to do so and the Government and Ofgem significantly deregulated the conditions of operation in 2016.
"Will the Business Secretary now take responsibility for the clear failure of regulation there has been and doesn't it suggest there needs to be a proper external review of the regulation of the market."
Since the beginning of September, 22 energy suppliers have failed. They were pushed out of the market by a spike in gas prices.
As a result of these prices, and a cap on what companies can charge their customers, businesses have been forced to sell energy for less than they bought it for.
Some of the biggest companies buy their gas far enough in advance that they have avoided the worst impacts of the price spike.
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