Electricity and gas supplier Panda Power has been forced to cease operations and exit the Irish market in the face of surging wholesale energy prices.
The company, which has more than 50,000 electricity customers, about 3 per cent of the market, and about 10,000 gas customers, is the largest Irish-based energy supplier to collapse so far as a result of the current crisis.
It is the fourth supplier to exit the Irish market in the space of a few months following the departures of Spanish energy giant Iberdrola, Glowpower and Bright Energy.
Panda, which is owned by the Meath-based Beauparc Utility Group, has no electricity generation assets so it is highly exposed to the rapidly rising price of gas and electricity on wholesale markets.
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One source said the company may have hedged incorrectly and be suffering liquidity issues as a result. The company could not be contacted for comment.
The Commission for Regulation of Utilities (CRU) confirmed it has been engaging with a supplier “in relation to their ongoing participation in the energy supply market”.
It said that if a supplier did exit the market, the CRU would implement its supplier-of-last-resort process which ensure the seamless transfer of customers to another supplier.
Daragh Cassidy, head of communications at price comparison website bonkers.ie, said this process would now kick in “with all electricity customers of Panda moved to Electric Ireland and gas customers moved to Bord Gáis”.
“However all these customers are likely to be placed on standard rates, meaning Panda customers who were on a discounted tariff could see a big rise in their bills,” he said.
The CRU statement said that through the supplier of last resort process, “the CRU’s objective is to agree an appropriate timeline to protect customers interests in terms of their choice to switch supplier and to ensure the continuity of supply for affected customer through the suppliers of last resort”.
The regulator said that until its discussions with the supplier have been concluded “it is not possible for the CRU to provide any further details”.
The wider Panda group, which includes significant waste management assets, entered the electricity market here in 2015 and the gas market in 2018 and employs more than 50 people in the energy side of the business.
Panda Power announced a price hike in August, the second this year, with electricity prices going up 12.7 per cent and gas by 25.8 per cent.
Mr Cassidy said news that Panda Power was stepping back from the market was “wholly unsurprising given the carnage on energy markets right now”.
“It’s likely more suppliers will fall over the coming months,” he said.
“This news hopefully puts paid to the somewhat populist narrative around placing a windfall tax on all energy companies,” Mr Cassidy said.
“It proves once again that many energy companies are actually struggling and that any windfall tax needs to be carefully considered and targeted to ensure it doesn’t cause more carnage. That’s not to say we shouldn’t seek to tax the energy market more. But there are no easy solutions,” he added.
