In the British electricity industry, “Triad” is a technical word. For years it meant the three half-hours of highest demand each winter, which set how much big users paid for the grid. Businesses hired people to predict them and switch off in time. Ordinary households could not, so they paid.
I want to borrow the word for something larger. There is a triad sitting over every energy bill in this country: the government, the energy companies, and the regulator. Each is supposed to check the others. In practice, each has found that a high bill suits it well enough.
What you are paying
From 1 October, the price cap for a typical household on gas and electricity is £1,723 a year. In the summer of 2021 it was £1,138. Wages have not risen by half in five years. Bills nearly have.
Look closer and it gets worse. Before you boil a kettle, you pay a standing charge: about 55p a day for electricity and 30p for gas. That is roughly £300 a year for the privilege of being connected. It lands hardest on the people who use the least: the pensioner heating one room, the single parent watching the meter. You cannot switch it off, and you cannot economise your way out of it.
This is the cost of living crisis most people actually feel. Not an abstraction about inflation, but a letter every few months that says the same thing: more, again.
My own bill
Those are averages. Here is a real one: mine.
Gas and electricity: £300 a month. Water: £100 a month. Council tax: about £250 a month. That is £650 every month, £7,800 a year, and I have not yet bought a loaf of bread. I have not paid the rent or the mortgage, put fuel in the car, bought a school uniform or paid for the phone. That is just the cost of the house being lit, warm, watered and allowed to exist.
Notice that my energy bill is more than double the “typical” figure Ofgem publishes. The typical household is a statistical creature. Real households are bigger, older, draughtier, have children at home or someone who works from it. The cap tells you the price of a unit; it tells you nothing about how many units a real family needs to stay warm.
Now put that against a wage. Someone earning £30,000 a year takes home roughly £2,100 a month after tax and National Insurance. My three bills alone would take nearly a third of it. What is left has to cover housing, food, transport and everything else, and it has to stretch further every year, because none of those three bills has ever gone down.
So how are people supposed to make it? The honest answer is that many of them are not. They are borrowing, skipping meals, turning the heating off, or working a second job to pay for the privilege of keeping the first. Not because they are careless with money. Because the fixed costs of simply living here have risen faster than anything they can do about them.
The first corner: the companies
Britain sells electricity in a market where the most expensive generator needed at any moment sets the price for everyone. Most of the time that generator burns gas. So when gas prices spike, as they did in 2022 and again this year, the price of electricity from wind farms and nuclear stations spikes with it, although their costs have not moved at all.
The sensible word for the difference is windfall. Generators keep much of it. The pipes and wires are owned by network companies with regulated monopolies. Citizens Advice estimates those networks will have collected between £6 billion and £7 billion more than intended over the current price controls, because their allowances were tied to inflation. The companies dispute the figure. They do not dispute that the rules were written that way.
None of this is illegal. That is the point. The companies are doing exactly what the rules reward.
The second corner: the regulator
Ofgem exists to protect consumers. It sets the price cap, sets the network allowances, and licenses the suppliers.
It is worth asking what that protection has looked like. In 2021 and 2022, around thirty suppliers went bust, many of them companies Ofgem had licensed with little scrutiny of whether they could survive a price rise. The cost of cleaning up after them was added to everyone else’s bills. The inflation loophole in network returns was pointed out to Ofgem in 2020, before it paid out. The price cap itself is a formula for passing costs through, not a mechanism for challenging them. It caps what a supplier can charge; it does not ask whether the cost underneath is fair.
A regulator that mostly calculates is not the same as one that protects. Ofgem is staffed by people who understand the industry well, many of whom came from it and will return to it. That is not corruption. It is simply what happens when the referee’s only friends are the players.
The third corner: the government
The government sits at the top of the triangle and has the most power to change it. It has also found the high bill useful.
A large share of what you pay is policy cost: levies for past renewable schemes, network investment, social programmes, all charged through bills rather than general taxation. That keeps them off the government’s books. A cost on your bill does not appear in the Budget, and nobody votes on it.
When prices spike, the Treasury also gains. Higher prices mean more VAT and, since 2023, a levy on generators’ excess profits. This year it raised that levy from 45% to 55%. It is welcome, but notice its shape: the windfall is allowed to happen and then shared, rather than prevented.
Governments of both parties have promised to “break the link” between gas and electricity prices. In April this government announced another package to do it, including new contracts for existing low-carbon generators. The contracts are voluntary. The link remains. Researchers at UKERC estimate that a proper reform could have saved around £10 billion a year, about £120 a household. We have been promised that saving, in one form or another, for most of a decade.
Why nobody has to conspire
I called this a triad, not a cartel, and the distinction matters. I am not claiming that ministers, executives and regulators meet in a room to agree your bill. They do not need to.
The companies are paid to maximise returns inside the rules. The regulator is paid to apply the rules consistently. The government benefits from the revenue and from keeping costs off its own balance sheet. Each acts rationally. Each can point at the other two when you complain. And the result is a system that has no reason to make your bill smaller, because nobody in it is rewarded when it does.
The household is the only party without a seat. We are the fourth corner, and the triangle was drawn without us.
What this does to a country
The cost is not only in pounds. It is in the retired couple who go to bed at seven to save on heating. In the family doing their homework at the library because it is warm. In small businesses closing because the energy bill outgrew the rent. In a generation that has quietly concluded that life here will be harder than it was for their parents, and that nobody in charge is trying to change that.
Living in Britain has become a struggle for a great many people who were not struggling ten years ago, and energy is near the centre of it. Energy is in everything: food, transport, rent, the price of every manufactured thing. When it is dear, everything is dear. The crisis is not artificial in the sense that the costs are invented. It is artificial in the sense that the arrangement that passes them to you was chosen, and could be chosen differently.
So what is the alternative?
Here I have to be honest, because the easy answers are not as easy as they sound.
Nationalisation is the one most people reach for. It would remove the shareholders from the middle, but it would not by itself change what gas costs, and a state-run industry would answer to the same Treasury that currently profits from the bill.
Pricing electricity by what it costs to make, rather than by the most expensive unit on the day, is closer to the heart of it. So is paying for past policy through general taxation, where it can be seen and voted on, instead of through a standing charge that falls hardest on the poor. So is a regulator whose success is measured by what households pay, not by whether the formula was applied correctly.
Some of the alternative is not in Westminster at all. It is on your own roof, in your own loft insulation, in community energy schemes where a town owns its own turbine and keeps the return. The less of your energy passes through the triangle, the less the triangle can charge you for it.
But none of those is a full answer, and I do not think I have one. What I am sure of is the question, and that we have stopped asking it out loud. We treat the bill as weather: something that happens to us, that we complain about and then pay.
It is not weather. It is a set of decisions, made by three parties who each find the current arrangement comfortable. So the question is not whether things could be different. It is who, if not us, is ever going to insist that they are.
What is the alternative?