A major UK energy supplier is on the brink of collapse, with reports suggesting it could fall into administration within the next 24 hours.
The company has been battling mounting financial pressures and has now run out of time to find a way forward.
According to reports, Tomato Energy filed a notice of intent to appoint administrators nine days ago, giving it limited breathing space to resolve its financial crisis.
Industry insiders say the firm owes significant debts that must be paid immediately to prevent administrators stepping in.
If the company fails to settle those debts by tomorrow, control will pass to administrators, who will then decide whether the business can be rescued or if it must be wound down.
The supplier, believed to serve around 12,000 to 14,000 households across Britain, has been under growing regulatory scrutiny in recent months as concerns mounted about its financial stability.
Energy regulator Ofgem announced on 13 October its intention to impose a £1.5 million financial penalty on Tomato Energy for failing to maintain adequate liquidity levels.
The proposed fine relates to breaches of standard licence conditions requiring suppliers to sustain sufficient funds for meeting ongoing financial obligations.
Energy bills have reached historic highs in recent years | GETTY The penalty follows non-compliance with provisional orders issued in April. Ofgem stated: "We are proposing a financial penalty requiring it to pay £1,500,000.
"This is for breaching the standard licence condition that requires it to obtain and maintain liquidity at a level that enables it to pay its ongoing financial liabilities."
The supplier has amassed debts exceeding £3million, prompting creditors to consider legal proceedings for debt recovery.
Ofgem has assured affected households that energy supplies will continue uninterrupted if Tomato Energy enters administration
| GETTYOfgem implemented a prohibition on new customer acquisitions in April after examining Tomato Energy's financial position. The investigation commenced when companies approached the regulator about pursuing legal remedies for outstanding debts.
The sales restriction remains in force until the supplier demonstrates compliance with financial management standards.
Last month, the regulator warned of potential licence withdrawal unless the company proved its financial viability within a three-month period.
In September, Ofgem declared: "We will take robust action to protect consumers if we see evidence that energy companies may be failing to comply with our rules." The Basingstoke firm has yet to satisfy regulatory requirements for financial stability.
Ofgem declined to discuss speculation about individual suppliers' financial circumstances
| GETTYOfgem has assured affected households that energy supplies will continue uninterrupted if Tomato Energy enters administration. The regulator's safety net ensures customers maintain their service and existing credit balances remain protected.
Households would be transferred automatically to a new supplier selected by Ofgem, though initial tariffs might be higher under temporary "deemed" contracts. Customers retain full flexibility to switch providers or negotiate different rates without restrictions.
The regulator declined to discuss speculation about individual suppliers' financial circumstances. However, it emphasised that no household faces disconnection when their energy company ceases trading, with seamless transitions guaranteed through established consumer protection mechanisms.