Bohemia Energy, one of the biggest electricity and gas suppliers in the Czech Republic, halted operations on Wednesday to become the largest group in the country to buckle under a Europe-wide jump in energy costs.
Benchmark European gas prices have soared this year because of factors such as low stocks, infrastructure outages and high demand in Asia, lifting power prices to record highs.
The privately held Czech business, which had about 900,000 customers, said clients would be served by suppliers of last resort, including the country’s biggest electricity producer CEZ .
The situation echoes that in Britain, where soaring wholesale energy prices have led some suppliers to collapse, with nine going bust in September alone.
Czech Prime Minister Andrej Babis said the government would look at how it could minimise the impact on customers, CTK news agency reported.
“With regret, we have to announce that the Bohemia Energy Group is, with immediate effect, ending supplies of electricity and gas to the Czech energy market,” the company said on its website on Wednesday.
“We were forced into this drastic step by the continued extreme growth of power prices in the wholesale market, where the price of both supplied commodities (electricity and natural gas) is now three times higher than last year.”
Bohemia Energy had become the country’s largest alternative energy supplier in recent years, competing with incumbent producers and distributors.
It was set up and controlled by businessman Jiri Pisarik, who was listed by Forbes as worth 8.3 billion Czech crowns ($378 million) this year.
Pisarik could not be reached for comment but was quoted by CTK as saying the decision to shut “was the most difficult that we had to take”.
Czech energy regulator ERU last week said it was looking into customer complaints that the company was ending contracts and fixed-price arrangements prematurely.
CEZ said in a statement it was prepared to fulfil its role as a supplier of last resort to Bohemia Energy’s customers.
“CEZ is a stable company and customers do not have to worry about finding themselves without electricity supplies,” it said.