Bulb Energy
{{short description|British energy supply company}}
{{Use British English|date=August 2020}}
{{Use dmy dates|date=November 2021}}
{{Infobox company
| name = Bulb Energy Ltd
| trade_name = Bulb
| logo = Bulb Energy company logo.png
| former_name = {{Ubl
| Regent Power Ltd (2013–2015)
| Hanbury Energy Ltd (June–August 2015)
}}
| type = Subsidiary
| industry = Energy supply
| predecessors =
| successor =
| founded = {{start date and age|2013|04|02|df=y}}
| founders = {{ubl|Amit Gudka|Hayden Wood}}
| defunct =
| hq_location_city = London
| hq_location_country = United Kingdom
| area_served =
| key_people =
| products =
| members = 1,700,000
| members_year = Nov 2021
| num_employees = 1,000{{cite web| url=https://bulb.co.uk/blog/annual-update-for-members-2020| title=Annual update for members 2020| author=Team Bulb| work=Bulb blog| date=2 March 2021| accessdate=10 June 2021}}
| num_employees_year = 2020
| revenue = {{increase}} £1.52B{{cite web| url=https://utilityweek.co.uk/bulb-saw-losses-reduce-in-2020/| title=Bulb saw losses reduce in 2020| author=Adam John| work=Utility Week| date=11 March 2021| accessdate=10 June 2021}}
| revenue_year = 2020
| net_income = {{increase}} -£63M
| net_income_year = 2020
| parent = {{ubl|Simple Energy {{smaller|(?–2022)}}|Octopus Energy {{smaller|(2022–present)}}}}
| website = {{Ubl
| {{URL|https://bulb.co.uk}} ({{Webarchive|url=https://web.archive.org/web/20230831010814/https://bulb.co.uk}})
| {{URL|https://bulb.com}} ({{Webarchive|url=https://web.archive.org/web/20230613071752/https://www.bulb.com/}})
}}
}}
Bulb Energy Ltd,{{Cite web |date=2013-04-02 |title=Bulb Energy Ltd overview - Find and update company information - Gov.uk |url=https://find-and-update.company-information.service.gov.uk/company/08469555 |access-date=2025-03-02 |website=Companies House |language=en}} trading as Bulb, was an energy supply company in the United Kingdom acquired by Octopus Energy in 2022. Founded in 2013, the company attracted venture capital from DST Global and Magnetar Capital and ran at a financial loss while achieving rapid growth in customers.{{Cite web |date=22 November 2021 |title='Too good to be true': the rapid rise and costly fall of Bulb Energy |url=https://www.theguardian.com/business/2021/nov/22/greenwashing-bulb-energy-critics-collapse-coming |access-date=22 November 2021 |website=the Guardian |language=en}} Bulb claimed to provide electricity and gas from renewable or off-set sources. As of November 2021, it had a share of approximately 5-6% of the UK energy market and was considered the seventh largest in the country.
In September 2021, the company sought a bailout due to financial problems caused by increasing natural gas prices. Instead, it was placed into the Energy Supply Company Administration (a special administration regime) by industry regulator Ofgem on 24 November 2021 following a refusal by investors to provide further funding. While customers of other failed suppliers have been transferred by Ofgem to new suppliers, the regulator decided Bulb was too large, so it became the first energy company in the UK to enter special administration.
In October 2022, Octopus Energy announced they planned to acquire Bulb's 1.5 million customers and 650 staff. The acquisition was completed on 21 December 2022.
History
File:155 Bishopsgate, London.jpg
Bulb Energy Ltd. was incorporated in April 2013 under Regent Power Ltd. and was known as Hanbury Energy Ltd. between June and October 2015.{{cite web |title=BULB ENERGY LTD - Overview (free company information from Companies House) |url=https://beta.companieshouse.gov.uk/company/08469555 |website=beta.companieshouse.gov.uk |access-date=11 March 2019 |language=en}} Its parent company is Simple Energy. From the start of trading, the directors were Amit Gudka, a former energy market trader for Barclays, and Hayden Wood, a former management consultant.{{cite news |title=Bulb switches on revenue growth but losses spiral |url=https://www.bmmagazine.co.uk/news/bulb-switches-on-revenue-growth-but-losses-spiral/ |work=Business Matters |date=19 December 2018}} Gudka stepped down from day to day activities at Bulb in February 2021 to focus on his new battery storage startup.{{cite web| url=https://bulb.co.uk/blog/an-update-from-our-founders| title=An update from our founders| author=Team Bulb| work=Bulb blog| date=19 February 2021| accessdate=10 June 2021}}
Initial funding came from the founders' savings and from their personal contacts. The backing was then obtained from JamJar Investments.{{cite news |title=Tech firm crowned UK's fastest-growing company |url=https://www.businesscloud.co.uk/news/tech-firm-crowned-uks-fastest-growing-company |work=BusinessCloud.co.uk |date=11 December 2018 |language=en}} In August 2018 a further £60 million funding was secured from two backers: DST Global (owned by Russian billionaire Yuri Milner), and US hedge fund Magnetar Capital.{{cite news |last1=Havelock |first1=Laurie |title=Bulb energy company targets one million customers as it takes on the 'big six' |url=https://inews.co.uk/news/business/bulb-energy-targets-one-million-customers-takes-on-big-six/ |work=i News |date=27 December 2018}} By 2018, the company was worth between £400M and £500M.
Growth was rapid from the start of 2017, and by early March 2019, the company had over 1 million customers and was employing over 550 staff.{{cite news |title=Tech firms Bulb Energy and Monzo bag £200 million in funding |url=https://www.standard.co.uk/business/tech-firms-bulb-energy-and-monzo-bag-200-million-in-funding-a3914241.html |work=Evening Standard |date=17 August 2018 |language=en}} Its headquarters moved in February 2019 from offices at Hanbury Street, Shoreditch to Bishopsgate in the City of London.
In 2018, Bulb was the UK's largest renewable energy supplier, and the UK's seventh-largest energy supplier, smaller only than the "Big Six".{{cite news |last1=Ross |first1=Kelvin |title=Bulb Energy named in top startups list |url=https://www.powerengineeringint.com/articles/2018/10/bulb-energy-named-in-top-startups-list.html |work=Power Engineering International |date=1 October 2018}}{{dead link|date=December 2021}} It was the only company to achieve this growth without taking over other companies, as rival companies had done.{{cite news |last1=Vaughan |first1=Adam |title=Small energy suppliers get a growth boost as their rivals collapse |url=https://www.theguardian.com/business/2019/jan/26/small-energy-suppliers-boost-rivals-collapse-big-six |work=The Observer |date=26 January 2019}} SyndicateRoom identified Bulb as the UK's fastest-growing private company of 2018.{{Cite web|url=https://www.standard.co.uk/tech/bulb-fastest-growing-tech-company-uk-need-to-know-a4012866.html|title=What you need to know about Bulb, the fastest growing UK tech company|date=10 December 2018|website=Evening Standard|language=en|access-date=7 February 2020}}
=Special administration and acquisition=
In September 2021, Bulb sought a bailout due to financial problems caused by sharply increasing natural gas prices.{{cite news|date=September 2021|title=UK energy company seeks funds to stay afloat|work=BBC News|url=https://www.bbc.co.uk/news/business-58619418}} In November 2021, Bulb became the first energy company to go into Special Administration, under which it would be run by the government through the regulator Ofgem.{{Cite news |date=22 November 2021 |title=Energy firm Bulb set to go into administration |language=en-GB |work=BBC News |url=https://www.bbc.com/news/business-59373198 |access-date=22 November 2021}}{{Cite web|url=https://www.msn.com/en-gb/money/other/taxpayers-face-enormous-fee-as-latest-energy-company-collapses-government-now-a-supplier/ar-AAR0u4Z?cvid=ea68e040a14c4849aadb855dce25a8e0&ocid=winp1taskbar|title=Taxpayers face enormous fee as latest energy company collapses: Government now a supplier|website=www.msn.com}}{{cite web |title=Bulb Energy Limited: information for interested parties |url=https://www.gov.uk/government/news/bulb-energy-limited-information-for-interested-parties |access-date=26 November 2021 |website=GOV.UK}} This process allowed the government the option to make grants and loans to the business while the administrators worked to transfer customers and sell the business in parts or as a whole.
The government set aside £1.7 billion to cover the company's trading costs and the cost of the administration.{{cite news|last1=Rojas|first1=John-Paul|date=25 November 2021|title=Taxpayers left with £1.7bn bill as Bulb, UK's seventh-biggest energy firm, collapses|language=en|work=Sky News|url=https://news.sky.com/story/collapse-of-britains-seventh-biggest-energy-firm-bulb-confirmed-leaving-taxpayers-to-take-the-strain-12477266|access-date=1 December 2021}} According to the Financial Times, at least two energy suppliers offered solutions that would have allowed Bulb customers to be switched to alternative providers at a reduced cost to consumers and taxpayers.{{Cite news|last=Thomas|first=Nathalie|date=2021-11-26|title=Two energy suppliers offered rival plans to Bulb's government bailout|work=Financial Times|url=https://www.ft.com/content/768cca61-d8c8-4231-9a30-7cc2c0864698|access-date=2021-11-30}}
The company's subsidiaries in France, Spain, and Texas were unaffected by its entry into administration.{{Cite web|date=22 November 2021|title=Bulb Energy, which supplies 1.7m customers, collapses into administration|url=https://www.theguardian.com/business/2021/nov/22/bulb-energy-which-supplies-17m-customers-collapses-into-administration|access-date=22 November 2021|website=the Guardian|language=en}} Teneo were appointed administrators of Bulb in the UK on 24 November,{{Cite news |last=Graham |first=August |date=24 November 2021 |title=Ofgem applies to put Bulb in special administration |work=The Independent |url=https://www.independent.co.uk/business/ofgem-applies-to-put-bulb-in-special-administration-b1963508.html |access-date=24 November 2021}} and Interpath were appointed for Bulb's parent Simple Energy.{{cite news |last1=Earl |first1=Nicholas |title=Sequoia swoops in to switch administrator of Bulb's parent company |url=https://www.cityam.com/bulbs-biggest-lender-swoops-in-to-switch-administrator-of-energy-firms-parent-company/ |access-date=1 December 2021 |work=City A.M. |date=24 November 2021}}
= Outcome =
In October 2022, Octopus Energy agreed to acquire Bulb's 1.5 million customers and 650 employees.{{cite news |last=Zeldin-O'Neill |first=Sophie |date=29 October 2022 |title=Octopus Energy announces takeover of collapsed supplier Bulb |newspaper=The Guardian |url=https://www.theguardian.com/business/2022/oct/29/octopus-energy-announces-takeover-of-failed-supplier-bulb-after-firm-collapses}}{{Cite web |date=2022-10-29 |title=UK government approves agreement between Bulb and Octopus Energy, providing certainty to 1.5 million customers |url=https://www.gov.uk/government/news/uk-government-approves-agreement-between-bulb-and-octopus-energy-providing-certainty-to-15-million-customers |access-date=2022-10-29 |website=GOV.UK |publisher=Department for Business, Energy & Industrial Strategy |language=en-GB}} The acquisition was completed on 21 December 2022.{{Cite news |last=Burton |first=Lena |date=21 December 2022 |title=Octopus completes the acquisition of Bulb Energy after a year-long saga |language=en-US |work=UK Daily News |url=https://ukdaily.news/octopus-completes-the-acquisition-of-bulb-energy-after-a-year-long-saga-259203.html/ |access-date=2022-12-21}}
In November, the Office for Budget Responsibility estimated the potential liability to be underwritten by the government was £6.5{{Nbsp}}billion,{{Cite web |last=Powell |first=Emma |date=2024-06-21 |title=Octopus Energy to repay £3bn taxpayer support for rescue of Bulb |url=https://www.thetimes.com/business-money/companies/article/octopus-energy-news-prepay-bulb-take-over-kjx9lm7g0 |access-date=2025-03-16 |website=The Times |language=en}} although the government stated that volatility in energy markets made forecasts difficult.
It was reported that costs of £1.5bn were incurred during the administration process. The government provided post-completion funding to enable Octopus to procure energy for ex-Bulb customers for the winter of 2022; in the event, Octopus drew down £1.6bn of this. By the summer of 2024, Octopus was expected to repay the government £2.8bn, comprising the £1.6bn plus £1.2bn profit from falling energy costs. As a result, it was estimated that the total cost to the government of Bulb's failure was £6.1{{Nbsp}}million.
Operations
In the year 2018–2019, Bulb's renewable electricity was generated as follows: 73% from wind power, 24% from solar power, and 3% from hydroelectricity. Bulb's carbon-neutral gas was composed of 10% biogas and 90% carbon offset.{{Cite web|url=https://bulb.co.uk/|title=Bulb - Making energy simpler, cheaper, greener|website=Join Bulb - Making energy simpler, cheaper, greener|language=en|access-date=7 February 2020}}
Bulb announced in June 2019 that they were expanding to France, Spain, and Texas.{{Cite web|date=6 June 2019|title=Bulb is expanding internationally|url=https://bulb.co.uk/blog/bulb-is-expanding-internationally|url-status=live|access-date=7 February 2020|website=Bulb|language=en|archive-url=https://web.archive.org/web/20210413235559/https://bulb.co.uk/blog/bulb-is-expanding-internationally/ |archive-date=13 April 2021 }}
In August 2020, Bulb agreed to pay £1.76 million in redress, refunds, and goodwill payments after industry regulator Ofgem found 11,400 customers had been overcharged, together with other mistakes (some self-reported by Bulb).{{Cite web|last=Bradley|first=Jane|date=13 August 2020|title=Energy firm pays out £1.76m after failing 61,000 customers|url=https://www.scotsman.com/business/consumer/energy-firm-pays-out-ps176m-after-failing-61000-customers-2940999|access-date=30 August 2020|website=The Scotsman|language=en}}
| class="wikitable"
|+Bulb customer numbers | ||
| Date | Customers (approx.) | Source |
|---|---|---|
| January 2017 | 15,000 | |
| August 2017 | 100,000 | {{cite web |title=Challenger to Watch: Bulb Energy |url=https://thechallengerproject.com/blog/2018/challenger-brand-to-watch-bulb-energy |website=The Challenger Project |date=26 January 2018}} |
| January 2018 | 200,000 300,000 | {{cite news|last1=Vaughan|first1=Adam|url=https://www.theguardian.com/business/2019/jan/14/sse-bulb-energy-firms-low-prices-uk|title=SSE hits out after Bulb claims big energy firms are squeezing families|date=14 January 2019|work=The Guardian}} |
| August 2018 | 670,000 | |
| January 2019 | 870,000 | |
| March 2019 | 1,130,000 | {{Cite web|url=https://beta.companieshouse.gov.uk/company/08469555/filing-history|title=BULB ENERGY LTD - Filing history (free information from Companies House)|website=beta.companieshouse.gov.uk|language=en|access-date=7 February 2020}} |
| November 2021
|1,700,000 |
References
{{reflist}}
{{Energy in the United Kingdom|companies}}
Category:2022 mergers and acquisitions
Category:Electric power companies of the United Kingdom
Category:Utilities of the United Kingdom
Category:Companies based in London
Category:British companies established in 2015
Category:Companies that have entered administration in the United Kingdom