The sole electricity supplier in the Channel island of Sark is cutting power to all 500 residents over a dispute with the government.
Th island has seen a growing battle between Sark Electricity Limited (SEL) and the Chief Pleas – the government of the island.
The company said cutting the electric supply would result in a "public health emergency" unless the island was evacuated – but that it was necessary because of a new pricing system.
A commissioner ordered SEL to reduce the price of electricity from 66p per kilowatt hour to 52p in August, with the company saying this would result in losses of £20,000 a month.
Director David Gordon-Brown said the company asked for a £250,000 grant from the government to cover its legal costs in fighting the commissioner's price cut but this was not provided.
In a letter to customers, Mr Gordon-Brown said: "So we no longer have any options. We have shown Chief Pleas an independent auditor's report that shows that we would lose over £83,000 by 31 December at the current electricity price.
"We needed to start on the legal work to overturn this judgment by the beginning of this month so mounting a lawyer-driven appeal against the commissioner's foolishness is no longer possible.
"As his price stretches on for two years, there is no possibility of surviving if we continue as we are so we must stop selling electricity.
"Although we will not be providing a general supply beyond the end of the month, we will work with the Medical and Emergency Services Committee to make sure that doctors and essential emergency services can function for another week beyond the end of the month to cover the transition period as everyone moves off the island."
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William Morris, one of the members of the Chief Pleas, told the Guardian that contingency plans were being drawn up.
He said: "The plans are in the development stage so I can't give out too much details, but it will involve consolidating around certain centres – making sure there are certain buildings that have power so people can congregate there."