Energy supply company special administration regime (ESCA): legal framework, appointment and court process, objectives, government funding, exit via transfer schemes, Ofgem v SoLR, and directors’ considerations

Published by a LexisNexis Restructuring & Insolvency expert

Practice notes

Background to the energy supply company special administration regime

The government established a special administration regime (SAR) for energy suppliers in the Energy Act 2011 (EnA 2011), adopting and adapting certain provisions from the Energy Act 2004 (EA 2004). Brought in as part of a broader package in EnA 2011, the SAR aims to strengthen energy security and ensure gas and electricity continue to be delivered as cost effectively as possible where a major supplier becomes insolvent and no purchaser can be secured.

To govern the procedure, the government also introduced the Energy Supply Company Administration Rules 2013 (ESCAR 2013), SI 2013/1046, which set the technical framework for energy supply company administrations (ESCA). ESCAR 2013, SI 2013/1046 reflects the Insolvency (England and Wales) Rules 1986, SI 1986/1925, diverging only to the extent needed to reflect ESCA’s specific provisions.

A special administration regime for gas transportation and electricity transmission and distribution entities had already been created by EA 2004, and the supplier SAR is modelled on that structure. The SAR was conceived as a fallback to the supplier of last resort (SoLR) arrangements, which enable Ofgem to revoke a supplier’s...

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Sophie Waples

A&O Shearman

Sophie is a senior associate in Allen & Overy LLP’s Global Restructuring Group, based in London. She advises on a wide range of insolvency and restructuring matters, as well as general corporate lending. Her clients include banks, distressed debt funds, large corporates, facility & security agents, insolvency practitioners and international financial institutions. Prior to joining A&O in June 2018, Sophie worked at one of Australia's leading corporate and commercial law firms. She has also completed associateships with the Honourable Justice Hammerschlag of the Supreme Court of New South Wales and the Honourable John Dyson Heydon AC KC, Royal Commissioner of the Australian Royal Commission into Trade Union Governance and Corruption....

Saarthak Jain

A&O Shearman

Saarthak is an associate in A&O Shearman’s Global Restructuring Group based in the London office. He advises on a wide range of insolvency and restructuring matters. His clients include banks, distressed debt funds, corporates and international financial institutions....

Web page updated on 21/05/2026

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