Utility Bills in London: How to set up your New London Home

Written by Corrina Pinsent, Settling-in Consultant at London Relocation | Last updated: November 2026

How much are bills in London? It’s one of the first things newcomers ask, and the honest answer depends on the size of the home, how it’s heated and the borough it’s in. Bills are almost never included in a London rental, and some charges, such as council tax and daily standing charges, are new to most people moving from abroad.

This guide shows what utility bills in London cost in 2026, with the average utilities cost per month for homes of different sizes. It explains each bill and what to check before you sign. Figures are dated and sourced, because energy prices change every three months.

Monthly utility bills in London by home size (2026)

Average bills per month in London, in £, October 2026. Totals exclude rent and council tax.

Energy is calculated from Ofgem’s typical usage levels at the London price cap rates for October to December 2026, rounded to the nearest £5. Water is based on Thames Water’s 2026/27 figures, broadband on typical fibre deals and the TV licence on £180 a year.

So the average bills for a 1-bed flat come to around £180 to £245 a month before council tax, and the average utility bill in London for a family house to about £305 to £335. If you’re comparing with the average monthly bills in the UK for 1 person, a London studio is similar for energy, because London’s price cap rates are close to the national average. For a two-person household, the average electricity bill in the UK at the current cap is about £50 to £70 a month.

Electricity and gas: what the price cap means for you

Most London renters pay a variable tariff limited by Ofgem’s energy price cap. From 1 October to 31 December 2026, the cap for a typical household paying by Direct Debit is £1,723 a year, according to Ofgem. That is the figure behind most headlines about the average energy bill in the UK, and it assumes 2,500 kWh of electricity and 9,500 kWh of gas a year.

The cap limits the price per unit and the daily standing charge, not your total bill. In London, the rates for October to December 2026 are:

Sources: Ofgem and MoneySavingExpert (London region).

At these rates, the average electric bill in London for a medium-use home is about £70 a month, with gas about £75. The government has also removed VAT from electricity bills from 1 October 2026 to 31 March 2027, which is already reflected in the rates above.

Electric-only flats have no gas bill or gas standing charge, but electricity costs roughly three times as much per unit as gas, so a poorly insulated electric-only flat can cost more to heat. Flats with storage heaters often have an Economy 7 meter with cheaper night-time electricity. Many homes now have smart meters. Prepayment meters are less common in the rentals our clients take.

The cap changes every three months. Ofgem will announce the January to March 2027 cap on 25 November 2026.

Water bills in London

Thames Water supplies most of London. Its average water and sewerage bill for 2026/27 is £658 a year, about £55 a month (MoneySavingExpert), slightly above the England and Wales average water bill of £639. In parts of north and west London, including Barnet, Brent, Ealing, Harrow and Hillingdon, Affinity Water supplies the water and Thames bills separately for sewerage.

Older homes are often billed on the property’s “rateable value”, while metered homes pay for what they use. Thames Water’s own examples for 2026/27: a metered home using 80 cubic metres a year pays £532 (about £44 a month), and one using 120 cubic metres pays £700 (about £58). The average water bill for a 2 person household on a meter is usually at the lower end of that range. Ask the agent which supplier serves the address.

Council tax: the bill most newcomers forget

Council tax pays for local services, and in a rented home the tenant almost always pays it. It depends on the property’s band (A to H) and the borough, and is usually paid in ten monthly instalments. Band D for 2026/27 in some of the boroughs where our clients live:

Source: each council’s 2026/27 council tax charges, including the Greater London Authority’s share.

If you live alone, you get a 25% single person discount. Full-time students are usually exempt. Our guide to council tax explains bands, discounts and how to register with your borough.

Broadband and mobile

A standard fibre broadband deal in London costs roughly £20 to £30 a month, and faster full-fibre packages for a family £30 to £40. Contracts usually run for 12 to 24 months, most often 24, and prices often rise at the end of the deal, so it pays to switch. SIM-only mobile plans start at around £5 a month, with unlimited data from under £10 to about £25. To check what speeds a building can get, see our guide to fibre internet in London rentals.

TV licence

You need a TV licence to watch or record live TV on any channel or device, or to use BBC iPlayer. It costs £180 a year from 1 April 2026, about £15 a month. If you only stream services such as Netflix and never watch live TV or iPlayer, you don’t need one. Our bills set-up guide explains how to buy one or declare that you don’t need it.

Are bills included in rent in London?

Usually not. Most London rentals on standard tenancies exclude all bills, and you set up energy, water, broadband and council tax yourself. Bills are more often included in serviced apartments, short lets, house shares and some studios. If they are, check whether there’s a fair-use limit on energy, and compare the higher rent with the table above.

Furnished or unfurnished makes little difference to bills; see our guide to the price difference between furnished and unfurnished rentals.

What makes your bills higher or lower

Two flats with the same rent can have very different running costs. The biggest factors are the Energy Performance Certificate (EPC) rating, the type of heating, the age and size of the home, and how you use it. Privately rented homes in England must have an EPC rating of at least E; a C or above is usually noticeably cheaper to heat.

London vs the US: how bills compare

For American readers, three things work differently. First, the standing charge: a fixed daily fee for electricity and gas, similar to the fixed service charge on many US utility bills. Second, council tax: in the US the owner pays property tax and builds it into the rent, while in London the tenant pays council tax directly. Third, what the landlord covers: buildings insurance and the building’s service charge are the landlord’s, but almost every household bill is yours.

Most London homes don’t have air conditioning, so summer bills are low and winter heating drives the cost. Many people pay a fixed monthly Direct Debit that averages this out over the year.

How to budget for bills before you move

1. Ask for the EPC and council tax band before you make an offer. Listings should show the council tax band.
2. Find out how the home is heated and which water supplier serves it.
3. Use the table above for your home size, then add council tax for your borough.
4. Add broadband and the TV licence if you need one.
5. Allow for winter. Energy use is much higher from November to March, so budget on an annual average rather than a summer month.

For the full picture, see our guides to the cost of living in London and average rent in London.

How London Relocation helps

Our settling-in service sets up your energy, water, broadband and council tax so that everything is in your name from the day you move in, and we tell you what to expect to pay before you choose a home. If you’re moving from the US, start with our guide to moving to London from the US.

FAQ

How much are bills per month in London for one person, a couple or a family?

In October 2026, a single person in a studio pays about £180–£190 a month for energy, water, broadband and a TV licence, a couple in a 1-bed or 2-bed about £180–£250, and a family in a 3-bed house about £305–£335. Council tax is extra.

Are bills included in rent in London?

Usually not. Most long-term London rentals exclude bills. Serviced apartments, short lets and house shares are more likely to include them, often with a higher rent and a fair-use limit.

What is the energy price cap, and what is a standing charge?

The price cap is the maximum suppliers can charge per unit of energy and per day on a standard variable tariff. It is set by Ofgem every three months. The standing charge is the fixed daily part of the bill, which you pay even if you use no energy.

Do renters pay council tax? How much is it?

Yes, tenants almost always pay council tax. For a Band D home in 2026/27 it ranges from about £1,020 a year in Wandsworth to about £2,600 in Kingston. People living alone get 25% off.

Do I need a TV licence, and how much is it?

You need one to watch or record live TV or use BBC iPlayer. It costs £180 a year from 1 April 2026. If you only use streaming services such as Netflix, you don’t need one.

Are bills more expensive in London than in the rest of the UK?

Not by much. London’s energy unit rates are close to the national average and its electricity standing charge is lower, and Thames Water’s bill is near the national average. Council tax in boroughs such as Westminster and Wandsworth is among the lowest in England. The big difference is rent.