THE collapse of Warrington Borough Council-backed Together Energy has sparked major concerns in the town.
Here is a timeline of events surrounding the company, which the Labour-run council invested in.
September 2019
It was confirmed that Labour-run Warrington Borough Council was set to pay £18 million for a 50 per cent stake in a Scottish energy company, as well as granting a £4 million loan to the company.
The deal over the equity stake and loan was approved by the cabinet at the Town Hall, subject to a ‘risk workshop’, although the financial details were discussed in private. The investment was later confirmed.
January 2020
Senior officers were told the council is ‘funding energy traders’ and will be ‘in trouble’ if the £18 million deal to invest in an energy company goes wrong.
The then-Appleton borough councillor Brian Axcell, Liberal Democrat, raised the risk of the investment during an audit and corporate governance committee meeting at the Town Hall.
He said: “It’s rather unique – there’s a very large sum of money and, as far as I can see, no assets to back it up.
“It’s not as if we’ve got property, which is the case with Birchwood Park?
“It’s really that we are funding energy traders – if they are successful good, if they are not we are in trouble.”
January 2020
A former cabinet member expressed fears over the council’s £18 million investment into the company after it finished bottom of an energy provider table.
Which? – an organisation promoting informed consumer choice in the purchase of goods and services by testing products – rated energy firms in Great Britain following feedback from customers.
Octopus Energy topped the table, while Together Energy finished last after being placed number 35.
The chart included matters including bill accuracy, bill clarity, customer service and value for money. Together Energy got an overall customer score of 48 per cent.
February 2020
Town Hall bosses were confident the council-backed energy company which had been subject to a high number of complaints had ‘turned a corner’.
During a leader’s forum, council leader Cllr Russ Bowden told residents the authority was attracted to the firm’s potential for growth and social values.
He said: “There are some really strong reasons why we invested in Together Energy – it is not just around income, there’s a lot of policy-driven investments.
“The council has bought two solar farms – one in York and one in Hull – I think over the lifetime they will bring in excess of £130 million of income for the council.
“But, fundamentally, what we want to do is have an energy company that we can use to supply that energy ourselves.”
March 2020
The energy company confirmed it works with six outsourced telesales contact centres in South Africa that have 90 staff allocated to its campaigns.
But Scottish firm said it only has one of its own members of staff based in South Africa, with the other 129 located in Clydebank.
November 2020
The council-backed energy company announced it had managed to break even for the first time after ‘surpassing’ predictions.
Scottish firm Together Energy was celebrating its four-year anniversary having delivered what it described as a robust financial performance and exceptional growth in the past year.
October 2021
It was confirmed that external advisers were being used by the council to assess the day-to-day situation of the energy company which it has invested in.
Deputy council leader Cllr Cathy Mitchell, who is the portfolio holder for corporate resources, updated the cabinet on the performance of Together Energy and the impact of the ‘current turbulence in the European energy markets’ during its meeting.
The Labour politician said the matter is being kept under constant review.
Cllr Mitchell also confirmed external advisers have been engaged to help monitor the day-to-day situation.
November 2021
The energy company insisted it is ‘financially stable’ following a warning that it could lose its licence to operate.
Together Energy was warned by Ofgem that it could lose its licence to operate – if it failed to make a payment by a deadline.
But it said it believes delaying the payment was in the ‘best interest’ of the company at this time.
November 2021
A gas and electricity supplier was left ‘fuming’ over the council-backed energy company’s non-payment that could leave other firms having to ‘pick up the pieces’.
Furthermore, Warrington South MP Andy Carter said: “It’s simply not acceptable that a company, partially funded by the taxpayer, is not meeting its statutory obligations to the regulator.
“Were any other businesses in Warrington to fail to pay their business rates they would be very quickly up in court.”
Tory Mr Carter also confirmed he was writing to the energy minister to highlight his concerns.
January 2022
Town Hall chiefs were slammed for making ‘chancy’ investments after it was reported that the energy firm was ‘on the verge of collapse’.
Sky News reported that Together Energy faced collapsing within weeks as a last-ditch search for new funding neared its end.
It had learned that Together Energy, which is 50 per cent-owned by Labour-run Warrington Borough Council, was likely to run out of money later in January without an emergency capital injection.
The news sparked major concerns in the town.
Conservative Warrington South MP Andy Carter said: “This really is a stark example of how this Labour council has failed Warrington.
“Not only have they racked up eye-watering levels of borrowing, more than £1.6 billion, higher than almost any other local authority in the country, they’ve made chancy investments using public money into some of the riskiest sectors.”
Today – January 18, 2022
The council-backed energy company announced it will cease trading immediately.
Together Energy confirmed the news in a message on its website
It said: “We are saddened to inform you that Together Energy is ceasing to trade.
“We regret to inform you that the company will cease trading with immediate effect. We want to thank you sincerely for your custom over the past five years.
“Despite press reports, we did buy enough gas and electricity for your needs, but the sustained increase in wholesale prices and the securities required to continue to forward purchase the energy, have meant that it is untenable for us to continue.”
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