Octopus Energy was identified in October 2022 as the acquirer of Bulb's customers, business assets and liabilities, including customer credit balances, following a sale that had originally been hoped for earlier in the summer1. The transaction was completed on 20 December, slightly after the start of an observation window1. Bulb had collapsed in the summer of 2021 and was placed into a special administration regime, the first use of that vehicle1.
The National Audit Office reported in June 2022 that £0.9 billion had been spent by Government on running Bulb through the special administration regime in 2021-20221. Costs for the special administrators, their legal advisers and Lazard totalled £49.9 million at the end of January1.
The Public Accounts Committee took evidence on the collapse on 25 May 2023, hearing from Ofgem chief executive Jonathan Brearley, Octopus Energy co-founder and chief financial officer Stuart Jackson, and special administrator Matt Cowlishaw of Teneo1. The committee chair set out the background:
"In October 2022,a delayed sale followed, it was originally hoped to have been earlier in the summer, and Octopus Energy was identified as the acquirer of Bulb's customers,business assets and liabilities, including customer credit balances"
The same session covered the wider price picture. Ofgem's chief executive said the new energy price cap was understood to be £2,074 for an average annual bill, against a cost to an average household of about £3,300 at the time, with the price guarantee fixing bills at £2,5001. He said the fall to £2,074 represented a drop of roughly £1,200 per year, and that bills remained substantially higher than the roughly £1,100 to £1,200 seen before the gas crisis1.
| Item | Figure |
|---|---|
| Government spend on Bulb special administration, 2021-2022 | £0.9 billion1 |
| Special administrators, legal advisers and Lazard costs to end of January | £49.9 million1 |
| New energy price cap, average annual bill | £2,0741 |
| Price guarantee level at the time | £2,5001 |
Why it matters for households
For Bulb's domestic customer base, the practical effect of the sale was a change of supplier without a change of meter or supply, with credit balances transferring as part of the transaction1. Households that had built up credit through direct debit payments were covered by that transfer, rather than left to claim against a failed company. The wider cost of the administration, including the £0.9 billion reported by the National Audit Office, was met by Government and therefore by taxpayers1.
The session also set out the limits of what was known. Ofgem's chief executive told the committee that predicting the gas market was difficult, saying every projection he had seen of how the market might evolve had turned out to be substantially wrong, and that a stable outlook was "literally a guess"1. For a household, that bears on how much weight to put on any forward view of unit rates when fixing a tariff or setting a direct debit.
What happens next
The committee heard that the energy price guarantee remains as a backstop if prices spike upwards again, until the end of March 2024, and that the energy bills discount scheme was in place for the year1. On the repayment of taxpayer support, the witness said that, looking at markets to date, repayment should be made by September 20241. A judgment in a related matter was published at the end of March1.
Sources1 cited
- [](https://committees.parliament.uk/oralevidence/13238/html/), committees.parliament.uk