The deal to transfer Bulb customers to My Green Pod Hero Octopus Energy has taken place, bringing vital reassurance to Bulb’s 1.5 million customers following a year of uncertainty.
Customers will remain on Bulb systems for a while, and will continue to be looked after by the same Bulb team.
Octopus is paying the government to take on Bulb’s customer base – it is believed to represent a higher amount per customer than suppliers typically paid to take on the customers of the 29 energy retailers who have failed since September 2021.
The agreement, implemented via a new process known as the Energy Transfer Scheme (ETS), will save taxpayers millions of pounds as Bulb moves back into private ownership and the government is no longer directly exposed to the volatility of the wholesale energy market.
The ETS, approved by the Business and Energy Secretary on 07 November, will see Bulb’s relevant assets moved into a new, ringfenced business – separate from Octopus Energy – to protect consumers during the transfer.
Taxpayers will benefit from a profit share agreement for up to four years, which will see them get a share of the profits the ringfenced business makes during this time.
‘This starts to bring an end to the huge financial exposures for taxpayers and paves the way for a better and more certain future for Bulb’s staff and customers.
‘For now, we’d ask Bulb customers to sit tight – they will still be looked after by the Bulb team. We’ll be in touch with customers as and when their account is ready to move to Octopus’ award-winning systems.’
CEO and founder of Octopus Energy
Since Bulb has been in Special Administration, the company did not hedge for the energy it has been supplying to its customers. The new business will start hedging for Bulb from day one and will ensure that the company is fully hedged by the end of March 2023.
Until hedging is fully restored, the government will provide financial support to the new business to buy energy for Bulb customers over the course of winter 2022. This financial support will be repaid by the new entity in accordance with an agreed repayment plan schedule.
Judicial Reviews have been received against the Business and Energy Secretary’s decision to approve the sale of Bulb Energy, with court dates for the reviews set for next year.
Octopus Energy Group has a strong track record in large-scale customer migrations, having completed over 10 acquisitions of energy supply companies and their customers.
Most recently Octopus moved over 580,000 Avro Energy customers to its Kraken platform – the largest customer migration ever conducted under the supplier of last resort (SOLR) process.
Octopus is headquartered in the UK and operates in 14 countries, with significant businesses in energy retail, generation, technology and electric vehicles.
It has received over £1 billion in investment from global giants, including investment funds and large energy companies.
Bulb customers can get regular updates on this process on the Bulb information page.