Spark Energy
{{short description|Scottish energy supply company}}
{{Use British English|date=April 2019}}
{{Use dmy dates|date=April 2019}}
{{Infobox company
| name = Spark Energy
| logo = Spark Energy logo.png
| logo_size =
| caption =
| type =
| traded_as =
| genre =
| fate = Absorbed
| predecessor =
| successor = OVO Energy
| founded = {{Start date|2007}}
| founder = Chris Gauld & PJ Darling
| defunct = {{End date|df=yes|2020|12|31}}
| location_city = Selkirk
| location_country = Scotland, UK
| locations =
| area_served = United Kingdom
| key_people = {{unbulleted list|Chris Gauld (CEO)}}
| industry = Utilities
| products = {{unbulleted list|Natural gas|Electricity}}
| production =
| services =
| revenue =
| operating_income =
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| num_employees = 400
| num_employees_year = 2018
| parent = OVO Energy (November 2018 -)
| divisions =
| homepage = {{Official URL}}
| footnotes =
}}
Spark Energy was an electricity and gas supplier in the United Kingdom, established in 2007 and headquartered in Selkirk, Scottish Borders. Its operating company Spark Energy Supply Ltd entered administration in November 2018, and industry regulator Ofgem appointed OVO Energy to take over Spark Energy's 290,000 customer accounts; OVO continues to run Spark as a separate brand, but is in the process of migrating all its customers to the SSE brand.
History
Spark Energy began in 2007 as a small start-up company.{{cite news |url=http://www.selkirkweekendadvertiser.co.uk/news/local-news/spark-set-to-take-on-60-new-staff-1-3839207 |title=Spark set to take on 60 new staff |work=Selkirk Weekend Advertiser |date=24 July 2015 |access-date=21 November 2015}} The board's background was in the letting industry{{cite news |url=http://www.ft.com/cms/s/0/957090a2-fb1b-11e5-b3f6-11d5706b613b.html#axzz4AFUqjzv1 |title=Chris Gauld, co-founder, Spark Energy: plugged in to power |work=The Financial Times |date=12 April 2016 |access-date=12 April 2016}} and they started Spark Energy to fill a gap in the utility market to meet the needs of letting agents, landlords and tenants.{{cite news |url=http://www.heraldscotland.com/business/13593419.Spark_Energy_launches_job_drive/ |title=Spark Energy launches job drive |first=Scott |last=Wright |work=The Herald |date=13 August 2015 |access-date=21 November 2015}} The company was established by Canadian entrepreneur PJ Darling, after research into the utilities and property management markets. Co-founder Chris Gauld was the primary driver and leader of the business during the early stages.
Spark was based in a former converted mill building in Town hill after moving from Penlan in 2016. The company made its first profit in 2013.{{cite news |url = https://www.telegraph.co.uk/finance/newsbysector/energy/10081652/Fast-growing-Spark-Energy-on-track-for-first-profit.html|title = Spark Energy sees turnover rise sharply|work = The Daily Telegraph|date = 26 May 2013|access-date = 13 January 2016}} In January 2014 the firm signed a deal with Morgan Stanley.{{cite news |url=http://www.scotsman.com/business/companies/energy/spark-energy-lands-morgan-stanley-contract-1-3280258 |title=Spark Energy lands Morgan Stanley contract |first=Dominic |last=Jeff |work=The Scotsman |date=23 January 2014 |access-date=21 November 2015}} Further growth occurred, which the company attributed to investment in its customer services and marketing. Some rebranding also took place, including the introduction of the tagline 'Bringing Energy to Life'.{{cite news |url=http://www.thedrum.com/news/2014/04/15/spark-energy-rebrands-take-big-six-following-morgan-stanley-deal-earlier-year |title=Spark Energy rebrands to take on the 'Big Six' following Morgan Stanley deal earlier this year |first=Gillian |last=West |work=The Drum |date=15 April 2014 |access-date=21 November 2015}}
In Spring 2014, Gauld was appointed as chief executive{{cite news |url=http://www.heraldscotland.com/business/13167060.Scottish_Investment_Bank_funding_for_Spark_Energy_up_to___855_000/ |title=Scottish Investment Bank funding for Spark Energy up to £855,000 |first=Ian |last=McConnell |work=The Herald |date=25 June 2014 |access-date=21 November 2015}} after Darling sold his stake in the business. In 2014 they were placed 23rd on the Sunday Times Fast Track 100, the highest-ranked Scottish company on the list.{{cite news |url=http://www.thecourier.co.uk/business/news/growth-of-forfar-based-rmec-earns-recognition-in-sunday-times-virgin-fast-track-100-league-table-1.724971 |title=Growth of Forfar-based RMEC earns recognition in Sunday Times Virgin Fast Track 100 league table |first=Andrew |last=Argo |work=The Courier |date=8 Dec 2014 |access-date=21 November 2015}}
Spark had a long relationship with both Scottish Enterprise and the Scottish Investment Bank, with the latter having invested around £855,000 with the company since 2008.{{Cite web|title = Spark Energy plugs in to a bright future|url = http://www.scottish-enterprise.com/knowledge-hub/articles/case-study/attract-investment/spark-energy|website = www.scottish-enterprise.com|access-date = 2016-01-19}}
In 2015, Spark Energy reported a turnover of more than £80{{nbsp}}million.{{cite news |url=http://www.heraldscotland.com/business/13198516.Spark_sees_profits_soar_beyond___1_million/ |title= Spark sees profits soar beyond £1 million |first=Scott |last=Wright |work=The Herald |date=24 January 2015 |access-date=21 November 2015}} {{As of|2015|July}} the company was thought to be one of the five largest employers in the Scottish Borders, with over 300 staff based at their offices in Selkirk, 120 of whom are in customer care.{{cite news |url=https://www.bbc.co.uk/news/uk-scotland-scotland-business-31490466 |title=Selkirk firm Spark Energy to pay £250,000 for rules breach |work=BBC News |date=16 February 2015}} In August 2015 the company recruited three senior executives, increasing the size of its leadership team. The company was granted a temporary derogation from regulator Ofgem from 22B.2(b) and paragraph 4 of SLC 22B of its gas and electricity supply licences in respect of the Affordable Social Housing Prepayment Tariff.{{Cite web|title = Energy watchdog sanctions new pre-payment tariff {{!}} News {{!}} Inside Housing|url = http://www.insidehousing.co.uk/energy-watchdog-sanctions-new-pre-payment-tariff/7009656.article|website = www.insidehousing.co.uk|access-date = 2016-01-19}}
In June 2016, the company announced that a management buyout, led by CEO Chris Gauld and CFO Hamish Osborn, was close to completion in a deal estimated to be worth in excess of £50 million.{{Cite news|url=https://www.bbc.co.uk/news/uk-scotland-south-scotland-36529258 |title=Management buyout bid at Selkirk-based Spark Energy|publisher=BBC News|access-date=2016-07-28}}
In 2016, the company acquired a 50% stake in a Sussex-based telecoms company, Home Telecom Ltd, for an estimated £3 million, as part of a mutual and existing relationship with Country Wide who owned the other 50% of the business. This saw the firm acquire approximately 14,000 telecoms customers.{{fact|date=September 2020}}
= Demise =
Spark Energy Supply ceased trading on 23 November 2018{{Cite web|url=https://beta.companieshouse.gov.uk/company/05857467|title=SPARK ENERGY SUPPLY LTD|website=Companies House|language=en|access-date=2019-04-26}} following financial difficulties, including non-payment of £14m to energy regulator Ofgem under the Renewables Obligation scheme.{{cite news|url=https://www.bbc.co.uk/news/uk-scotland-south-scotland-46316603|title=Spark Energy Supply ceases trading|date=23 November 2018|work=BBC News|access-date=23 November 2018}} Ofgem appointed Bristol-based OVO Energy to take over the 290,000 customer accounts, and OVO also acquired Spark Energy Limited.{{Cite web|url=https://beta.companieshouse.gov.uk/company/SC301188/filing-history|title=Spark Energy Limited: filing history|date=28 November 2018|website=Companies House|access-date=26 April 2019}}{{Cite web|url=https://www.ofgem.gov.uk/publications-and-updates/ofgem-appoints-ovo-energy-take-customers-spark-energy-supply-limited|title=Ofgem appoints Ovo Energy to take on customers of Spark Energy Supply Limited|date=2018-11-27|website=Ofgem|language=en-gb|access-date=2019-04-26}}
{{As of|2021}}, OVO continues to use the Spark brand and is in the process of moving all remaining Spark customers to its SSE brand.{{Cite web|title=SSE migration: Frequently Asked Questions - Spark™ - Bringing Energy to Life|url=https://www.sparkenergy.co.uk/ssefaqs|access-date=2021-09-18|website=www.sparkenergy.co.uk}}{{Cite web|title=SSE and Spark|url=https://sse.co.uk/welcome/sse-and-spark/answers|access-date=2021-09-18|website=sse.co.uk|language=en}}{{Cite web|date=2019-09-13|title=Ovo to be UK's second-largest energy supplier after £500m SSE deal|url=http://www.theguardian.com/business/2019/sep/13/ovo-to-become-uk-second-largest-energy-supplier-after-500m-sse-deal|access-date=2021-09-18|website=the Guardian|language=en}} OVO initially retained the company's Selkirk offices and staff,{{Cite news|date=2019-01-28|title=Energy supply switch going 'smoothly'|language=en-GB|work=BBC News: South Scotland|url=https://www.bbc.com/news/uk-scotland-south-scotland-47027987|access-date=2019-04-26}} but closed those offices in 2020.{{Cite web|last=Janiak|first=Kevin|date=19 May 2020|title=Nearly 400 Borders jobs at stake as Ovo Energy closes its Selkirk office|url=https://www.thesouthernreporter.co.uk/business/nearly-400-borders-jobs-stake-ovo-energy-closes-its-selkirk-office-2857685|access-date=2021-09-18|website=www.thesouthernreporter.co.uk|language=en}}
Issues
While establishing itself in the marketplace, the company had attracted a substantial number of complaints.{{cite news |url=https://www.bbc.co.uk/news/uk-scotland-south-scotland-23099008 |title=Selkirk-based Spark Energy investigated by Ofgem |work=BBC News |date=28 June 2013}} Their business model meant that tenants did not get to choose their supplier, with Spark Energy inheriting customers from property owners, demanding payments and forcing customers to have the firm as their energy supplier.{{cite news |url=https://www.bbc.co.uk/news/business-25492239 |title=Spark Energy 'impersonated customers' to remove 'debtors' |first=John |last=Neal |work=You & Yours |publisher=BBC |date=23 December 2013}} BBC Radio 4’s You & Yours consumer programme revealed that Spark Energy employees had posed as some of these customers, moving people with chronic debts to other energy firms without their knowledge, using their personal details. In 2015 they were fined £250,000 by Ofgem, after they were judged to have mistreated customers during the 2010–2013 period by impersonating customers to switch 'undesirable' customers from whom payment was difficult to collect, to other suppliers, a term known in the industry as 'erroneous transfers'.
The company rebranded and undertook a several-year-long campaign in an attempt to revive their image and customer service practices, and in the 2014 Which? Switch energy satisfaction survey, Spark Energy outranked all of the "big six" providers. However, in the 2017 Which? survey Spark was ranked 30th out of 31 providers.{{cite web |last1=Ingrams |first1=Sarah |title=Which? energy survey results |url=https://www.which.co.uk/reviews/energy-companies/article/best-and-worst-energy-companies/which-energy-survey-results |publisher=Which? |access-date=19 June 2018}}
References
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