Enova Energy, Australia’s first community-owned electricity retailer, has announced it will enter voluntary administration as a result of ongoing “diabolical” energy market conditions.
The Byron Bay-based energy provider said it could no longer operate due to what its managing director Felicity Stening described as the “unbearable” impact of the current energy crisis, particularly affecting the east coast of Australia.
“The current diabolical state of the energy market, combined with the high wholesale market energy prices and the cap on customer pricing, has made it impossible for Enova Energy and many other small retailers to operate,” Ms Stening said in a statement cited by the ABC.
“In addition, the constant raft of state and federal government regulatory changes is adding to the market complexities and have caused Enova delays in being able to fund and resource energy innovation.”
Enova had been lauded for providing customers with an innovative green energy option; it was rated ‘Australia’s greenest power company’ in Greenpeace’s 2022 Green Electricity Guide and received a Canstar Blue Green Excellence Award in 2022 for its energy sourcing strategy.
In a statement on Enova’s website, however, Ms Stenning explained that more recently Enova had not been able to secure a new fixed-pricing agreement, which meant it would have soon been exposed to the skyrocketing wholesale energy prices being endured by energy retailers.
“There have been extreme and unexpected costs flowing from the unprecedented energy market conditions which has had an impact on Enova beyond what we are able to manage,” Ms Stening said. “Further, due to the prevailing market conditions, Enova has not been able to secure fixed pricing from July 1, 2022, meaning the business becomes fully exposed to the severely inflated wholesale energy prices on that date.
“Together with the requirements of the Australian Energy Market Operator for Enova to provide security for future electricity purchases and the regulated cap on customer pricing, it has become unviable for Enova to continue.”
Enova previously had a pricing agreement with renewables-focused provider Diamond Energy. As part of this agreement, Diamond Energy was the source of about half of Enova’s electricity supply. The rest of Enova’s supply came from its own customers’ rooftop solar systems.
The news of Enova’s voluntary administration comes as New South Wales, Victoria, south-east Queensland, South Australia and Tasmania prepare for July 1 price hikes in default electricity prices.
Several other smaller retailers, including ReAmped Energy, have recently told their customers to look for a better deal with another retailer or face a doubling of their bills as a result of the volatile market.
Enova Energy entered the Australian electricity market in 2016 as a social enterprise with a heavy focus on renewable energy sources.
The company serves 13,200 energy customers across New South Wales and south-east Queensland.
What does this mean for Enova Energy’s customers?
Enova’s customers won’t lose their energy supply. Instead, they’ll automatically be transferred to a new electricity retailer as part of the Australian Energy Regulator’s (AER) Retailer of Last Resort Scheme.
Typically, customers are transferred to one of the big three providers – Origin, AGL or EnergyAustralia, through this scheme – but customers can choose another provider if they wish.
Customers will need to settle any outstanding or final payments with Enova before they can be transferred to a new provider.
Once customers have been transferred, their new retailer will reach out with regard to future payments and billing cycles.
For more information, customers can visit the Enova Energy website.
You may be interested in:
Image credit: Scott’s cut/Shutterstock.com
Share this article