Together Energy asked Warrington Council for funds before collapse

The rise in energy prices led to Together Energy's expected losses rising from £43m to £181m

An energy firm which was part-owned by a council sought extra funding from the authority in the months before it collapsed, a new report has revealed.

Together Energy, which was 50% owned by Warrington Borough Council, ceased trading in January.

The company asked the authority for funding in September and December, but both times the council refused.

The report by administrators FRP Advisory also said the council should recoup its full loans to the company.

The report said the Labour-run authority was owed £18.8m at the time of FRP Advisory's appointment and the council "should have its outstanding debt paid in full".

However, it said any payment was subject to the final determination of ownership of some of the firm's assets.

Loss of £52m 'inaccurate'

Warrington Borough Council bought a 50% stake in Together Energy for £18m in 2019.

The firm, which had 175,000 customers, was profitable in the year to 31 October 2020, but due to the rising costs of energy, it began to struggle and its expected losses by October 2022 rose from £43m to £181m in December 2021.

The administrators said while the council had "previously indicated a willingness to increase their investment", the authority decided in September 2021 it was "unable to offer the further funding required due to the risk profile of any further investment".

Opposition councillors had called for transparency over the council's dealings weeks before the company delayed paying a £12.4m payment to Ofgem at the end of October 2021.

The following month, it sought new investment or a sale, but more than 10 potential buyers withdrew following the increase in energy prices.

The firm approached the council again on 29 December, but the authority "reconfirmed" it would not provide further support "against the uncertain market backdrop", the administrators said.

It ceased trading in January, with its customers moved to British Gas on 23 January, and administrators were appointed in February.

Council leader Russ Bowden the report showed the authority was "expected to get back all of its loans" and would not have to fund "the guarantee with our energy wholesaler", estimated to be about £29m.

He added that while it was not currently possible to say how much the council will "ultimately receive back, we know with certainty that previous speculation about the council facing a loss of £52m is inaccurate".

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