The latest collapses in the energy market by Iresa and National Gas and Power are a clear signal to Ofgem to act says GMB Union
GMB, the energy union, today called for Ofgem to set strict rules for granting licences to trade to independent energy companies after Iresa and National Gas and Power were the latest to go to the wall.
Action is needed to protect consumers and reduce market turbulence following the latest two collapses, the union says.
Iresa ceased trading on July 27 after previously being banned by the regulator from taking on new customers and increasing direct debit payments.
It was voted the worst energy firm for customer service by Citizen's Advice this year. 
Meanwhile National Gas and Power, which provided energy to business customers, also went belly up last month. 
The pair are the third and fourth independent energy suppliers to go bust recently, following Future Energy, in January this year and GB Energy in 2016. 
With the high number of energy suppliers offering break-even or below cost energy at the moment, the likelihood of further high profile collapses is almost inevitable; a situation GMB believes will be greatly exacerbated when the government introduces an energy price cap.
Justin Bowden, GMB National Secretary, said:
“The latest collapses in the energy market by Iresa and National Gas and Power are a clear signal to Ofgem to act, and this is before the fun really starts when a price cap is set.
“GMB is calling for Ofgem to set strict rules for the granting of licences to trade to independent energy companies.
“The likelihood of further high profile collapses is almost inevitable and the position will only get worse when a cap comes in, particularly if it is poorly structured and set at the wrong level.
“The reason Iresa went bust was because it was offering extremely cheap prices for energy that it could not sustain, a model that is repeated throughout the sector. With wholesale prices steadily rising over this year and predicted to continue doing so into the future, we can expect more of the same unless Ofgem intervenes and tightens things up.”