The co-founder and chief executive of collapsed supplier Bulb Energy (Bulb) has apologised for costing the taxpayers billions of pounds.
Hayden Wood told MPs: “I’m very sorry for the way things turned out. This has been an extremely challenging time for the energy sector.”
He also revealed he is still being paid £250,000 per year – despite the fallen firm being propped up by the taxpayer.
The energy chief told the Business, Energy and Industrial Strategy (BEIS) Committee he was asked to stay on to “support customers”.
Bulb is the first supplier to fall into special administration, following its collapse last November.
The firm struggled to deal with the constraints of the consumer price cap amid soaring wholesale costs, and has also faced criticism for failing to hedge effectively.
Wood told MPs the company had realised it “couldn’t afford” losses which would have been incurred in supplying energy to customers with prices of wholesale gas reaching £4per therm – despite having £120m in the bank.
For context, it the price cap limited Bulb to charging customers any more than 70p per therm.
Bulb worked with US investment group Lazard in the weeks prior to its administration to try and secure a buyer.
However, when no sale materialised, Wood said: “We had no reasonable prospect of being able to fund those losses for customers and that is when we made the difficult choice to enter special administration”.
Bulb still looking for buyers
Since then, Bulb has been on life support, sustained through regular transfusions of taxpayer funds – with the Office for Budget Responsibility estimating costs have risen to £2.2bn.
Wood admitted to the Business, Energy and Industrial Strategy (BEIS) that Bulb sold some hedged energy last year to provide capital and ease its sales process.
He said: “It was an unprecedented situation and the only time we did that. When those funding and sale discussions fell through, we had no reasonable prospects of being able to fund those losses for customers and that’s when we made the difficult decision to enter the special administration process.”
It is still the UK’s seventh-biggest energy supplier with 1.7m customers, and has been linked with multiple bids since it first fell into financial difficulties.
City A.M. understands administrators are still looking to sell the company and are expecting bids in the coming weeks.
However Woods refused to be drawn into discussions over its current status.
He did reveal Bulb had “multiple interested parties at the final stage” of a sale process before entering special administration, without naming any prospective buyers.
Bulb is currently being run by its administrator Teneo, while its parent company Simple Energy is being overseen by Interpath Advisory.