Energy company Utilita pulls out of deal to provide gas and electricity to Portsmouth homes due to supply uncertainty

Utilita had been set to run a new service for the city council but 'temporarily' pulled out hours before a meeting on Monday at which the deal was being considered.

Meredydd Hughes, the council's assistant director for buildings said 'rapid developments' in recent days had forced the firm to stop taking on new customers.

'These factors have overtaken us to the extent that Utilita have advised us that they are temporarily ceasing taking on new customers,' he said. 'They've assured us that the service to existing customers will remain their priority.'

The Eastleigh-based energy provider has been supplying empty council homes in Paulsgrove following the launch of a pilot in February aimed at saving money and making it easier for new tenants.

A report said the trial had had a 'positive' affect and was 'providing a clear and concise service to tenants' while saving it money and staff time. It had recommended it be expanded to cover all of the council's housing.

But the ongoing issue of rapidly rising wholesale gas prices, which has led to multiple energy providers collapsing in recent days and prompted Utilita's decision to withdraw from the project, instead saw cabinet member for housing, councillor Darren Sanders, defer a decision.

He said at his decision-making meeting that he had been reassured it was only a 'temporary' policy brought in by Utilita and that a report would be brought back for approval 'at the earliest opportunity'.

'The chaos that is the global energy market at the moment has many repercussions and unfortunately this is one of them,' Cllr Sanders said. 'The easiest thing would be to scrap the whole thing, but if they're saying they are still interested in this then that would not be right.

'Deferring this report is sensible. No-one will suffer as a result of this.'