Energy crisis 'won't affect my utility firm or football club', Fleetwood Town boss Andy Pilley insists
The future of Fleetwood Town Football Club is safe and secure despite the ongoing fuel crisis, its energy entrepreneur owner told fans.
Andy Pilley, whose gas and electricity firm BES employs hundreds of people on the Fylde coast and is the main sponsor at Highbury, said his tactic of buying energy in advance has made the company immune to the rocketing prices, which have soared by 250 per cent this year.
The 51-year-old, who has overseen a rapid rise through the leagues in recent years, said: “From a personal point of view it does not affect us at all because we hedge [a financial strategy aimed at reducing the risk of loss caused by fluctuating prices, in this case buying enough gas to cover each contract when it is taken out] in advance the entirely of our contracts so it makes no difference to us whatsoever.
"We have no requirement to buy so we are on the sidelines looking on and we can see these incredibly high prices but, thankfully, we are not getting involved at all.
“But that’s not the same for many, many suppliers out there. I think there’s lots – possibly the majority of domestic suppliers – that will be bleeding very, very heavily right now.”
Mr Pilley said some energy firms “will roll the dice” on the wholesale cost of gas and electricity and “they hope it will be favourable” and expect, at worst, marginal fluctuations.
He said: “What’s happened here is, anyone who has not purchased the full cover that is required for their customers’ contracts, is going to find themselves in a situation whereby their ins are nowhere near what their outs are.
“That’s causing people to be in an insolvent situation and subsequently they are going to have to close their businesses, and I fear that many people will lose their jobs.”
Many energy companies in the UK have already folded amid the ongoing price chaos, with fears as many as 60 could collapse by the end of the year.
While Mr Pilley, who lives in Thornton, said Fleetwood Town’s growth has been “in no small way due to the success” of his companies, including BES, overseas calls centres, and merchant services firm Card Saver, he insists it isn’t “anywhere near as reliant on my utilities business as what it used to be”.
He added: “We are running on a much smaller wages bill and we have a lot more asset value in the football club than we used to have.
“My message [to fans] would be, ‘Fleetwood will not be affected at all by this because BES is absolutely fine. The way we run our business has made us absolutely safe and we are not affected by these ridiculous prices. We have already purchased ahead.’
“What I would say is I feel for anyone who is going to lose their job – who is at an energy brokerage or maybe at a supplier who has been gambling on their wholesale cost – but it won’t affect Fleetwood and it won’t affect BES.”
Mr Pilley, who lamented the “terrible state of affairs” was on an industry round-table call with Kwasi Kwarteng on Wednesday afternoon and agreed the situation is currently a “crisis”.
Ahead of the call, he said: “Really, my grievance with the way the Government deals with the energy sector is that the cost of any failed supplier is passed on to successful suppliers and ... that’s the message I will be putting onto the Secretary of State – that’s it’s totally unfair that if somebody runs their business in a casino-style, betting on the wholesale price, if and when that business fails, it shouldn’t be passed on to successful businesses who don’t deserve to be saddled with that cost.”
Mr Pilley said BES “wouldn’t want any customers from the failed suppliers right now” because “there’s credit balances that you have to service and there’s contract prices which are simply uncommercial so I think they will go to the Big Six [British Gas, EDF Energy, E.ON UK, Npower, Scottish Power, and SSE]”.
He continued: “The problem for the Big Six is that they are going to be hit with huge costs and I think that’s where the Government is going to have to intervene and spend the taxpayers’ hard-earned money in making that right for the person who has to inherit these failed businesses.”
Mr Pilley said there “is going to be a lot of implications here for an awful lot of people”, including businesses and households, as well as those working in the industry who face losing their jobs.
It comes as the head of the regulator Ofgem warned that “well above” hundreds of thousands of customers may be left in limbo as their energy supplier goes bust in coming months.
Jonathan Brearley declined to give an estimate when in front of MPs on the Business, Energy and Industrial Strategy Select Committee.
He said: “We do expect a large number of customers to be affected, we’ve already seen hundreds of thousands of customers affected, that may well go well above that.
“It’s very hard for me to put a figure on it.”
It emerged this week that the Government and Ofgem was warned as early as two years ago the energy sector is fragile, according to the chief executive of supplier trade body Energy UK.
Emma Pinchbeck said: “I took this job a year ago. When I was hired, the chairman of Energy UK said that your biggest challenge is going to be the vulnerability of the retail market.
“I know that for a year or more before that my team have been making the case to the regulator and the Government that the sector is fragile.”
Mr Kwarteng said preparations were being made for gas prices to remain high for some time, despite Prime Minister Boris Johnson describing the problem as “temporary”.
He told the Business, Energy and Industrial Strategy Committee: “I think ‘temporary’ means that it’s a position where the price has spiked considerably… I think it has quadrupled in the last six months, seven months.
“You would expect normally that the price would revert to the mean, it’s not something that we think is going to be sustainable.
“But, of course, we have to prepare for longer-term high prices.”
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