London Daily

Focus on the big picture.
Thursday, Aug 28, 2025

Taxpayers' Bulb bailout cost plunges after Octopus supply deal with government

Taxpayers' Bulb bailout cost plunges after Octopus supply deal with government

The government could make a profit of up to £1.2bn on energy supplied to Octopus's newly-acquired Bulb customers, partly offsetting the overall cost of the industry's biggest bailout.

The cost to taxpayers of rescuing the biggest residential energy supplier to collapse during the recent industry crisis has plunged - a rare glimmer of good news after two years of turmoil.

Sky News has learnt that the latest figures sourced from insiders suggest that the demise of Bulb, which became insolvent in November 2021, will have been far less costly than forecast.

According to industry figures close to the situation, the bill to taxpayers between the timing of Bulb's special administration and its takeover by Octopus Energy in December totalled £1.45bn.

However, executives close to the buyer are now said to believe that the government is expected to make a profit of up to £1.2bn on the supply of energy to Bulb between the date of the takeover and the end of March.

This unexpected windfall for the state has been caused by the difference between the wholesale prices paid by the government - which have plunged in recent months - and the fixed price, set at the level of the current industry cap, paid by Octopus to obtain that energy.

Sources said that dynamic was likely to reduce the overall cost of the Bulb bailout to several hundred million pounds, although the ultimate figure remains subject to change.

On a per customer basis, that would make the Bulb rescue cheaper than some of the supplier of last resort (SOLR) deals struck with Ofgem, the energy regulator, during the last two years.

Octopus Energy was appointed to take on Bulb, the first energy supplier to be put under 'special administration'

Bulb, with more than 1.5m customers, was by far the largest residential energy player to collapse as wholesale prices soared.

At the time, it was the UK's seventh-biggest gas and electricity supplier.

The reduced taxpayer bill may be relevant in the context of judicial reviews lodged by rival energy suppliers including Centrica, the owner of British Gas, which alleged that the sale of Bulb to Octopus Energy had been unfairly handled.

A three-day hearing has been scheduled to hear the suppliers' challenged beginning on 28 February.

On Thursday, Centrica sparked a new political row when it reported record annual profits of over £3bn.

In December, the Department for Business, Energy and Industrial Strategy (BEIS) said it had been advised by Bulb's special administrator to set an upper limit for the post-takeover funding facility of £4.5bn.

"The £4.5bn figure represents an estimated upper limit of the support based on forecasted energy costs during the period until 31 March 2023, which reflects the current volatility in global energy prices, BEIS said at the time.

Greg Jackson is Octopus Energy's chief executive


"The extent of government support could be lower than £4.5bn, depending on energy prices this winter."

The £4.5bn estimate was in addition to the estimated £1.45bn pre-sale cost to taxpayers, but the government's fiscal watchdog - the Office for Budget Responsibility - went even further, suggesting that the Bulb bailout could ultimately cost the public purse as much as £6.5bn.

In a more recent statement provided to Sky News, a government spokesman said: "The sale of Bulb to Octopus Energy concluded on 20 December 2022 and the transfer of customers is now in progress. Ensuring that we get the best outcome for Bulb's customers and the British taxpayer remains our priority.

"We worked with Special Administrators to ensure fair and open competition to give Bulb's 1.5 million customers much needed reassurance, while providing best value for taxpayers.

"The government will provide the remaining funding necessary to ensure that the special administration is wound up in a way that protects customers' energy supply. We will recoup these costs at a later date."

As part of the sale to Octopus, it is said to have agreed to pay between £100m and £200m to take on Bulb's customer base, with a separate profit-share agreement giving the government a return for several years on earnings from Bulb customers.

An Octopus Energy spokesperson said: "Octopus always said this is a fair deal and good value for taxpayers.

"It's becoming increasingly clear how good a deal the government have got."

Newsletter

Related Articles

0:00
0:00
Close
Bruce Willis Relocated Due to Advanced Dementia
French and Korean Nuclear Majors Clash As EU Launches Foreign Subsidy Probe
EU Stands Firm on Digital Rules as Trump Warns of Retaliation
Getting Ready for the 3rd Time in Its History, Germany Approves Voluntary Military Service for Teenagers
Argentine President Javier Milei Evacuated After Stones Thrown During Campaign Event
Denmark Confronts U.S. Diplomat Over Covert Trump-Linked Influence in Greenland
Starmer Should Back Away from ECHR, Says Jack Straw
Trump Demands RICO Charges Against George Soros and Son for Funding Violent Protests
Taylor Swift Announces Engagement to NFL Star Travis Kelce
France May Need IMF Bailout, Warns Finance Minister
Chinese AI Chipmaker Cambricon Posts Record Profit as Beijing Pushes Pivot from Nvidia
After the Shock of Defeat, Iranians Yearn for Change
Ukraine Finally Allows Young Men Aged Eighteen to Twenty-Two to Leave the Country
The Porn Remains, Privacy Disappears: How Britain Broke the Internet in Ten Days
YouTube Altered Content by Artificial Intelligence – Without Permission
Welcome to The Definition of Insanity: Germany Edition
Just a reminder, this is Michael Jackson's daughter, Paris.
Spotify’s Strange Move: The Feature Nobody Asked For – Returns
Manhunt in Australia: Armed Anti-Government Suspect Kills Police Officers Sent to Arrest Him
China Launches World’s Most Powerful Neutrino Detector
How Beijing-Linked Networks Shape Elections in New York City
Ukrainian Refugee Iryna Zarutska Fled War To US, Stabbed To Death
Elon Musk Sues Apple and OpenAI Over Alleged App Store Monopoly
2 Australian Police Shot Dead In Encounter In Rural Victoria State
Vietnam Evacuates Hundreds of Thousands as Typhoon Kajiki Strikes; China’s Sanya Shuts Down
UK Government Delays Decision on China’s Proposed London Embassy Amid Concerns Over Redacted Plans
A 150-Year Tradition to Be Abolished? Uproar Over the Popular Central Park Attraction
A new faith called Robotheism claims artificial intelligence isn’t just smart but actually God itself
Deputy Prime Minister Angela Rayner Purchases Third Property Amid Housing Tax Reforms Debate
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Italian Facebook Group Sharing Intimate Images Without Consent Shut Down Amid Police Investigation
Dutch Foreign Minister Resigns Amid Deadlock Over Israel Sanctions
Trump and Allies Send Messages of Support to Ukraine on Independence Day Amid Ongoing Conflict
China Reels as Telegram Chat Group Shares Hidden-Camera Footage of Women and Children
Sam Nicoresti becomes first transgender comedian to win Edinburgh Comedy Award
Builders uncover historic human remains in Lancashire house renovation
Australia Wants to Tax Your Empty Bedrooms
MotoGP Cameraman Narrowly Avoids Pedro Acosta Crash at Hungarian Grand Prix
FBI Investigates John Bolton Over Classified Documents in High-Profile Raids
Report reveals OpenAI pitched national ChatGPT Plus subscription to UK ministers
Labour set to freeze income tax thresholds in long-term 'stealth' tax raid
Coca‑Cola explores sale of Costa coffee chain
Trial hears dog walker was chased and fatally stabbed by trio
Restaurateur resigns from government hospitality council over tax criticism
Spanish City funfair shut after serious ride injury
Suspected arson at Ilford restaurant leaves three in critical condition
Tottenham beat Manchester City to go top of Premier League
Bank holiday heatwave to hit 30°C before remnants of Hurricane Erin arrive
UK to deploy immigration advisers to West Africa to block fake visas
×