Taxpayers are set to pay £200 each for the rescue of failed energy supplier Bulb, it was revealed yesterday
In an update, the Office of Budget Responsibility said the cost of bailing out the firm had risen to a colossal £6.5bn, making it the largest government-funded rescue since Royal Bank of Scotland in 2008.
Originally estimated at £2.2bn, the OBR said that figure had swelled by a further £4.6bn due to the company not being allowed to buy gas forward and having to pay hugely inflated spot prices.
Previous forecasts had estimated the maximum cost at £4bn.
A deal to sell the company to rival supplier Octopus Energy was agreed last month, but is still being held up by objections from other suppliers about its transparency.
Another supplier, Ovo Energy made a late bid, while British Gas owner Centrica PLC (LSE:CNA) dropped out earlier.
Bulb had 1.5mln customers when it collapsed last November and its size led to a new special administration vehicle run by the government being established.
It is one of 28 gas and electricity suppliers that have gone under in the past year due to wholesale gas prices soaring in the wake of the war in Ukraine and Russia cutting off supplies.
The cost of rescuing those other suppliers has been estimated at £94 per taxpayer.
Andy King from the OBR said: “The cost of the Bulb intervention has increased essentially because it lasted for more months than was factored into the March forecast.
“So the transfer to Octopus has happened six months later. The loss that was incurred operating Bulb in between those two time periods is the additional cost.”
Bulb founder Hayden Wood was heavily criticised earlier this year when it was revealed he was still being paid a £250,000 a year salary months after the firm had gone bust.