Britain's annual energy cap for a typical household on a default tariff will rise 4 per cent to 1,723 pounds on 1 October, driven by higher gas costs. In water, the government is considering changes to special-administration rules that could bring Thames Water into public control. Household bills and the future of a heavily indebted utility now turn on separate regulatory choices.
Ofgem will raise the gas and electricity cap for a typical household paying by direct debit by 60 pounds a year to 1,723 pounds from 1 October. That is an increase of about 5 pounds a month, or 4 per cent. Gas bills will rise 8 per cent while electricity stays broadly stable; households without gas face an increase below 1 per cent. The cap covers roughly 22 million households on default tariffs.[1]
The regulator attributed the increase to higher wholesale gas prices linked to the conflict in the Middle East. The government's removal of value-added tax from household electricity bills kept the cap about 45 pounds below where it otherwise would have been. Roughly 11 million households, or 35 per cent of the total, are on fixed tariffs and will be unaffected. The new level remains 52 per cent below the 2022 peak, when the government capped bills at 2,500 pounds.[1]
The prime minister is reportedly considering changes to the special-administration regime so companies such as Thames Water can enter insolvency proceedings and move into public control. The company does not meet the current insolvency or basic-service thresholds while creditors keep supporting it, and an administrator must maximise creditor returns. Creditors have offered a 10 billion pound turnaround plan against 20 billion pounds of debt and have promised a judicial review if the rules change.[2]
