Big Six energy supplier npower has announced it is to cut around 900 jobs as part of a cost reduction programme.
The firm says worsened market conditions, such as Ofgem’s price cap and high levels of fixed tariff competition, have forced it to make the decision.
Although around 900 roles in the company’s 6,300-strong workforce are expected to be affected, npower says the actual number of redundancies will be considerably lower as around this number of people leave the company each year under normal conditions.
Paul Coffey, CEO of npower, said: “The retail energy market is incredibly tough – Ofgem itself forecasts that five of the Big Six energy companies will make a loss or less than normal profits this year due to the implementation of the price cap and with several recent failures of new energy suppliers, it is clear that many have been pricing at levels that are not sustainable.
“Even with these reductions, we still forecast significant losses this year but we’re doing everything we can to minimise them whilst continuing to focus on service and value for our customers.”
Consultations with affected employees and unions are due to start in early February.
A BEIS spokesperson said: “Our price cap protects 11 million households from poor value standard variable and default tariffs and ensures that consumers pay a fair price for their energy.
“Ofgem designed the energy price cap independently, through consultation with industry, so that an efficient supplier can continue to thrive.”