OVO Energy
OVO Energy is a major energy supplier based in Bristol, England.
| Industry | Retail supply of energy and home telecommunications |
|---|---|
| Founded | 2009 |
| Headquarters | Bristol, England, UK |
| Subsidiaries |
|
| Website | www |
It was founded by Stephen Fitzpatrick and began trading energy in September 2009, buying and selling electricity and gas to supply domestic properties throughout the UK. By June 2017 OVO had 680,000 customers, an increase of 10,000 over the previous year, representing a 2.5% domestic market share.[1] In November 2018, OVO Energy acquired one of its largest competitors, Spark Energy. Although at first one of over 15 smaller energy companies competing with the Big Six which dominated the market, in January 2020 OVO completed the acquisition of the retail arm of SSE, becoming itself one of the Big Six and the country's third-largest domestic energy supply company.
History
OVO Energy is British-owned and privately backed, with its headquarters in Bristol. OVO Energy supplies gas and electricity to domestic customers since 2009, and to business customers since 2013.[2] This sector of the UK economy is dominated by a number of larger companies known as the Big Six.[3]
On 14 February 2019, Mitsubishi Corporation bought a 20 percent stake in OVO, valuing the company at £1bn.[4]
OVO Energy is part of OVO Group, which in turn is a subsidiary of Imagination Industries Ltd, a holding company wholly owned by Stephen Fitzpatrick.[5]
In 2022, OVO Energy was ranked second worst (only behind Utilita) in customer service by Citizens Advice.[6]
Acquisitions
The 2018 acquisition of Spark Energy included a subsidiary, Home Telecom Limited, which specialises in providing telephone and broadband services to tenants of private landlords.[7][8]
In September 2019, OVO agreed to pay £500 million for SSE Energy Services, the retail business of SSE plc,[9][10] and the purchase – which included SSE's 8,000 employees and their phone, broadband and heating insurance customers – was completed in January 2020.[11] This made OVO the UK's second-largest energy supply company (after British Gas) with around 5 million customers.[11] OVO stated that the SSE brand would continue for the time being.[12] SSE had earlier intended to merge the business with Innogy's subsidiary Npower, but this was called off in December 2018.[13] Following OVO Energy's takeover of SSE, numerous reports of incorrect and inflated bills were reported by former SSE consumers who had their accounts transferred to OVO Energy.[14][15]
Regulator action
OVO Energy has been fined across two consecutive years, from 2020 to 2021, for their predatory practices.
In January 2020, OVO Energy agreed to pay £8.9m into Ofgem's voluntary redress fund, after an investigation by Ofgem found instances of undercharging and overcharging, and inaccurate annual statements sent to more than half a million customers between 2015 and 2018.[16] Head of Ofgem enforcement, Anthony Pygram, said "The supplier did not prioritise putting these issues right whilst its business was expanding."[17]
In March 2021, as part of a wider investigation into price protection failings by energy suppliers, OVO's practices were found to have caused detriment to 240,563 customers totalling over £2m, and the company was required to pay redress of over £2.8m – the highest amount of compensation among the 18 companies investigated.[18]
Despite such regulator action, OVO energy's practice of overcharging consumers remains a common recurring theme within news reports.[19][20][21]
Electricity
Electricity supplied by OVO Energy comes from various sources including wind farms in Gloucestershire and North Wales, and the burning of landfill gas. Its two tariffs include 50% green electricity (OVO Better Energy) and 100% green electricity (OVO Greener Energy).
OVO's "pay as you go" product has been branded as Boost since 2017. After taking on customers from Economy Energy in 2019, the brand had around 350,000 customers.[22]
Gas
OVO Energy sources its gas from the national grid.[23] The majority of the UK's gas is sourced from the North Sea; the rest comes from Norway, Continental Europe and some from further afield. Increasingly, gas is imported as liquefied natural gas (LNG), natural gas cooled to about −165 °C (−265 °F) and compressed to make it easier to transport.
Energy market competition
The entry of OVO into the UK supply market in 2009 was welcomed as it increased competition in a market that had been criticised for high prices.[24][25]
In October 2013, Managing Director Stephen Fitzpatrick appeared at the Energy and Climate Change Select Committee, when energy companies were asked to justify recent gas and electricity price rises. Fitzpatrick explained to the committee that the 'wholesale gas price had actually got cheaper', contrary to the Big Six energy suppliers' assertions that international global prices of gas and electricity had consistently risen.[26]
In November 2018, OVO acquired one of its rivals, Spark Energy, after the troubled supplier ceased trading.[27]
Following the collapse of Economy Energy in January 2019, regulator Ofgem announced that OVO Energy would take on Economy Energy's 235,000 customers.[28]
Sponsorship
In 2016, OVO sponsored the Bristol leg of the Tour of Britain cycling race.[29] In 2017, the company began sponsoring both The Women's Tour and the Tour of Britain, the longest cycle stage races taking place in the UK.[30] In March 2018, OVO announced they would begin providing equal prize money for both tours.[31] They are no longer sponsoring either race as of 2021[update].
In October 2021, OVO Energy took over sponsorship of Glasgow's entertainment and multi-purpose indoor arena, which was rebranded as the OVO Hydro.[32]
Management
Stacey Cartwright was appointed as chair of the board at OVO Energy in April 2020. She holds other directorships including at Savills, Genpact and the Football Association, and was deputy chair at retailer Harvey Nichols.[33] Non-executive directors include Jonson Cox, chair of water regulator Ofwat.[34][35]
References
- ^ "Key facts about OVO Energy". www.ovoenergy.com. Retrieved 9 July 2017.
- ^ Mason, Rowena (7 July 2011). "Energy Secretary to help new suppliers break into market dominated by Big Six". The Daily Telegraph. London.
- ^ Eaton, George (28 October 2013). "New questions for the big six mean Miliband's price freeze will continue to dominate". New Statesman. Retrieved 24 September 2019.
- ^ "Mitsubishi buys 20% stake in greentech company Ovo Energy". Industry Europe. 14 February 2019. Retrieved 2 September 2020.
- ^ "Imagination Industries Ltd: Annual Report to 31 December 2018". Companies House. Retrieved 8 January 2020.
- ^ "Worst customer service on record from energy companies, says Citizens Advice". Citizens Advice. Retrieved 1 July 2022.
- ^ Dungay, David (17 May 2017). "Spark Takes Aim At Telecoms Partners With Home Telecom Purchase". Comms Business. Retrieved 8 January 2020.
- ^ "Home Telecom Limited: Financial Statements to 31 December 2018". Companies House. Retrieved 8 January 2020.
- ^ "Ovo to become UK's second largest energy supplier after £500m SSE deal". The Guardian. 13 September 2019. Retrieved 13 September 2019.
- ^ Stoker, Liam (13 September 2019). "OVO seals £500 million swoop for SSE supply division". Current News. Retrieved 22 January 2020.
- ^ a b Thicknesse, Edward (15 January 2020). "Ovo completes £500m purchase of SSE's retail business". CityAM. Retrieved 22 January 2020.
- ^ "Questions about OVO and SSE?". OVO Energy. Retrieved 22 January 2020.
- ^ "SSE weighs options as Innogy UK retail merger collapses". Reuters. 17 December 2018. Retrieved 22 January 2020.
- ^ "Customers 'receive £80k energy bills moving from SSE to OVO'". Energy Live News. 25 November 2022. Retrieved 25 November 2022.
- ^ Tims, Anna (23 November 2022). "UK energy customers receiving bills of up to £49,000 after Ovo takeover of SSE". Guardian UK. Retrieved 23 November 2022.
- ^ "Ovo Energy to pay £8.9m for overcharging customers". BBC News. 29 January 2020. Retrieved 29 January 2020.
- ^ "Ovo Energy to pay £8.9m for overcharging customers". BBC News: Business. 29 January 2020. Retrieved 29 January 2020.
- ^ Williams, Martin (2 March 2021). "'Regret': Scots energy firms ordered to pay millions in compensation for overcharging". The Herald. Retrieved 24 November 2021.
- ^ Tims, Anna (2 November 2022). "£19,000 in debt to Ovo: customers' haunting tales of energy bill horror". Guardian. Retrieved 2 November 2022.
- ^ Deeney, Yvonne (22 November 2022). "Mum-of-three forced on to prepayment meter by Ovo after energy bill doubled within a month". Guardian. Retrieved 22 November 2022.
- ^ Hyland, Jennifer (6 November 2022). "Scots couple charged £13,000 by OVO Energy for energy bill in one night". Daily Record. Retrieved 6 November 2022.
- ^ "About us". Boost. Retrieved 22 January 2020.
- ^ "Our fuel mix – Where does OVO get its electricity from?". www.ovoenergy.com.
- ^ "Martin Hickman: Suppliers run rings around regulators". The Independent. London. 7 October 2009.
- ^ "Newcomers try to shake up the energy market". The Northern Echo.
- ^ "Ovo Energy boss 'confused' by larger firms' price rises". BBC News. London. 29 October 2013.
- ^ "Ofgem appoints OVO Energy to take on customers of Spark Energy Supply Limited". Ofgem. 27 November 2018. Retrieved 8 January 2020.
- ^ Peachey, Kevin (11 January 2019). "Winter 'will see more energy firms fail'". BBC News. Retrieved 11 January 2019.
- ^ "OVO Energy announced as Bristol sponsor for the Tour of Britain". Bristol City Council News. Retrieved 5 January 2020.
- ^ "New sponsor for 2017 Tour of Britain and Women's Tour". British Cycling. British Cycling Federation. 20 April 2017. Retrieved 21 April 2017.
- ^ Cary, Tom (7 March 2018). "Women's Tour of Britain to be given prize money parity with men's race". The Telegraph.
- ^ "The OVO Hydro is the new name for Scotland's home of live entertainment". Ovo Hydro. 14 October 2021. Retrieved 14 October 2021.
- ^ Grundy, Alice (20 April 2020). "Chair of new OVO Energy Board appointed after SSE acquisition". Current News. Retrieved 23 February 2021.
- ^ Lempriere, Molly (6 August 2020). "OVO Energy continues to grow new board with appointment of non-executive director". Current News. Retrieved 22 February 2021.
- ^ "Who we are". Ofwat. Retrieved 23 February 2021.
External links
- Official website