Terry Durack presents his annual restaurant awards, The Terrys

Lunch, dinner, lunch, dinner, lunch, dinner: it has been one hell of a year. I seem to have been running from one new restaurant to the next for months now, just trying to keep up. There has never been a year like this for new establishments: Harden's restaurant guide noted a record jump of 13 per cent in the number of new eateries in 2007, rising to a total of 158, eclipsing the previous record of 142 set in 2005.

But never mind the quantity, what about the quality? Let me exchange that provocative word hell for heaven. London can now lay claim to being the world's most exciting food city. Paris is still down in the dumps, Sydney isn't sure which way to go, the biggest news in New York is our own Gordon Ramsay, and Las Vegas doesn't count, as it has its own casino-driven economy. But London is booming, enriched by a glamorous, high-spending international crowd with bags of money at one end, and sustained by increasingly food-conscious natives at the other. Have we ever eaten better, at all levels?

Let's start at the top. In the past 12 months, we have seen restaurant heavyweights Chris Corbin and Jeremy King's St Alban in one corner, with the Caprice Group's star-studded rebirth of Scott's oyster bar in the other. Then came the contenders. Former River Café chef Theo Randall set up shop in the InterContinental, and Gary Rhodes blasted back into contention with his blingy Rhodes W1. Then Zuma's Arjun Waney created a nice little piece of Nice in Mayfair with La Petite Maison, and Texture allowed chef Agnar Sverrisson from Le Manoir to introduce London to the clean, pure flavours of New Nordic cuisine. Now all eyes are on the newest blossom to flower in Mayfair, as Claude and Claire Bosi transplant their much-lauded Hibiscus from Ludlow to London.

As ever, the excitement generated in the capital has a knock-on effect further afield, creating a British gastro-climate in which young chefs can grow. The most promising results of this can be seen at The Kitchin in Edinburgh, which received a Michelin star in February, and Purnell's in Birmingham, an ambitious new venture for Glynn Purnell of the Michelin-starred Jessica's in Edgbaston.

Real proof of our gastronomic epiphany is not that one flash meal of the year, however, but how well you can dine out during the week without breaking the bank. The gospel according to St John, Clerkenwell's benchmark British restaurant, has had several young disciples spread the word in dining-rooms across the land. These are the chefs who, more than any other group, have the power to define British dining. Look at the food they are cooking – whole braised oxtail from Hereford Road, roast kidney from Magdalen, seven-hour lamb shoulder from Great Queen Street, steak-and-kidney pud from Emily Watkins at the Kingham Plough in Oxfordshire, and the faithful rendition of roasted bone marrow with grilled bread at buzzy new Hammersmith gastropub, the Carpenter's Arms.

To cap it all, the celebrated Alain Ducasse is opening at The Dorchester this month. In any other year, such a coup would hit the headlines. This year, it's just another one to get to before Christmas, along with Tom Aikens' new fish-and-chippie, Tom's Plaice, Acorn House's Water House, Pied à Terre spin-off L'Autre Pied, Rowley Leigh's Le Café Anglais, and Alan Yau's Sake No Hana. Wish me luck. '

Comeback of the year: Gary Rhodes at Rhodes W1

Our Gary had been a bit quiet for a celebrity chef, before bouncing back with one of the most impressive openings of the year. The food, under head chef Brian Hughson, is light and elegant with deceptively simple flavours that are carefully, completely compatible – from the tongue-in-cheek double oyster ragout (real oysters and chicken oysters) to the delicate Cornish lobster. Service is as smooth as silk, from one of the best service teams in London.

Best new trend: Fresh air

The smoking ban came into force on 1 July, giving rise to the newest icon of British dining – the outdoor ashtray. The smartest are of free-standing polished chrome, but the sexiest is the miniature Ferris wheel of ashtrays outside the front door of Mourad Mazouz's Sketch in Conduit Street. Prompting the question – did Heath Robinson smoke?

Best value: Viet Grill

Especially pleasing has been the number of south-east Asian restaurateurs raising the bar on quality and ambition without raising the price too much at the same time. My Cheapsticks Terry goes to Viet Grill, an offshoot of Hoxton's popular Cay Tre, where the smart modern décor and winelist upgrade the usual Kingsland Road dining experience. So does the food, from a great pho noodle soup to a lovely dish of grilled beef wrapped in "la lot" wild betel leaves, and a Mekong catfish claypot. Other top new tables are Kiasu in Queensway, Snazz Sichuan in Euston, Pearl Liang in Paddington Basin, the snacky Japanese Bincho Yakitori in the Oxo Tower and Haozhan (in Chinatown – there is hope for it yet).

Celebrity chef of the year: Marco Pierre White

The devilish White has gone to hell and back this year, actually stepping into the shoes of his once protégé/now nemesis Gordon Ramsay to front the TV chef reality show Hell's Kitchen. A million headlines, profiles and soundbites later, he out-celebbed TV chefs half his age. And he's not the only one to be recycled –the braised pig's trotter with morels made famous at his ground-breaking Harvey's nearly 20 years ago is now on the menu at his new restaurant, Marco, at Stamford Bridge, home to Chelsea Football Club. All of which proves that there is no "has-been" in Marco's vocabulary, only "will be".

The saddest goodbye: Neal Street Restaurant

On 17 March, the restaurant that introduced London to trademark dishes such as wild mushroom soup, crab ravioli and bollito misto, closed due to redevelopment of the building. The restaurant was opened by Sir Terence Conran in 1971, then taken over by Antonio and Priscilla Carluccio in the 1980s, serving the likes of Prince Charles, Nicole Kidman and Sir Elton John. Through his television shows, cookbooks and neverending love affair with funghi, Antonio became the much-loved face of Italian food in this country. But we haven't lost him altogether, as he fronts the spectacular new upstairs/downstairs Carluccio's flagship café and food store in Covent Garden.

New restaurant of the year: Texture

Crisp crunches of cod skin, soft jellies of berries, tongue-tingling foams of champagne, mouth-meltingly slow-cooked suckling pig – the Icelandic-born chef Agnar Sverrisson, late of Le Manoir, serves up a provocatively textural feast, informed by the healthy, icy-clean flavours of New Nordic cuisine. Together with Le Manoir sommelier Xavier Rousset, ' Texture dazzles. In short, Texture is the most modern new restaurant in Britain,

Chef of the year: Claude Bosi of Hibiscus

At last, London gets to see what all the fuss was about. In a year crammed with hotly anticipated openings, they didn't come any hotter than the relocation of Claude and Claire Bosi's two-Michelin-starred Ludlow local hero. Bosi doesn't disappoint, teaming up strange bedfellows – such as ice-cream and foie gras, and suckling pig and sea urchin – like a mad geneticist, turning them into intriguingly subtle gastroprey. Sorry, Ludlow, he's not coming back.

The birthday boy of 2007: Le Gavroche turns 40

To make it to 40 in these interesting times is a real achievement. Started by the Roux brothers in 1967 and now run by Albert's son, Michel, Le Gavroche not only celebrated its landmark this year, but it did so while still regarded as a benchmark dining experience. A big happy birthday, also, to Momo (a frisky 10) and The Bombay Brasserie (25).

Wine list of the Year: Wild Honey

It's not the biggest list, nor is it the most wide-ranging, but it's just so damn diner-friendly. Anthony Demetre and Will Smith reprise their runaway success at Arbutus with this clubby, likeable Mayfair newcomer. As at Arbutus, Demetre's menu turns less-popular meat cuts and sustainable fish into confident, balanced dishes of sheer deliciousness, while Smith has created a wine list that is appealing and accessible. It may run up to a 1989 Château Haut-Brion (below), but joy of joys, most wines are reasonably priced and available in highly useful 250ml, two-glass carafes. That means you can have white while she has red, or you could each share a New Zealand Sauvignon Blanc, a Mornington Peninsula Pinot Noir and an Italian Amarone throughout.

The silver service award: Purnell's, Birmingham

Service overall is improving, with highly polished teams in place at most of the big names in London. But I'm giving the Terry to a place where the service has to work harder to make the experience a magical one. Local boy made good Glynn Purnell (pictured) has made a brave push for a contemporary regional cuisine in his sleek new Birmingham city centre restaurant, and he's lucky to have the charming Jean-Benoit Burloux on the floor, smoothing out the bumps. Burloux knows his wines, too, and has that special art of being able to talk you effortlessly through both the wine list and the menu, without shoving either down your throat. That's our job, after all.

Restaurant design of the year: East Beach Café, Littlehampton

Weeks before it opened, East Beach Café was named by the Observer as one of the five best beach cafés in the world. It's not, but the building itself is worth the trip. Dubbed "The Guggenheim of Littlehampton", it is the work of groundbreaking, metal-bending designer Thomas Heatherwick and it was commissioned by locals Sophie Murray and her mother Joan Wood, who were appalled by the council's existing proposed design for a beachside kiosk. Heatherwick's dark and weather-beaten steel "shell" was designed to look as if it had been washed up on the beach from the court of King Neptune. Now let's hope they get the inside working as well as the outside.

The 'It' restaurant of the year: Scott's

Scott's did not have an easy rebirth. Not only did it take Caprice Holdings two years and millions of pounds to restore the 156-year old seafood veteran, but a last-minute licence dispute meant it couldn't officially trade. So, for the first 10 days of operation, no bills were brought at the end of the meal, a gesture that cost an estimated £350,000. Caprice Holdings' generosity has been rewarded with fierce loyalty among London's dining cognoscenti and the celebrity A-list. Best spot is at the green onyx oyster bar, with fine views of the modern British art on the walls, and a pint of prawns from Mark Hix and Kevin Gratton's hysterically British menu in front of you.

Unforgettable dishes of 2007

1. Glynn Purnell's breakfast-inspired but very beautiful poached egg yolk with smoked haddock milk foam, corn flakes and curry oil at Purnell's in Birmingham.

2. A sweet, light-as-mousse Norwegian king crab with sauce vierge and cockles at Pascal Proyart's relaunched One-O-One in Knightsbridge.

3. Roast woodcock served with the split head (the brains are the best bit) and a pâté of foie gras and woodcock liver on toast, at Kitchin in Edinburgh.

4. An elegantly reworked pissaladiere (Provençal onion tart) from La Petite Maison in Mayfair.

5. Wood-roasted turbot cooked on the bone with erbette (a kind of Swiss chard) at Theo Randall at the InterContinental.

Forgettable dishes of 2007

1. Grandma's bean curd from XO in Belsize Park, more bland bean soup than the pepper-spiked classic it should have been.

2. An impossibly salty plate of salt beef with under-cooked carrots at Gordon Ramsay's first gastropub, The Narrow.

3. Over-cooked, chopped-up spaghetti with cockles that tasted like pasta water at ' the East Beach Café in Littlehampton, West Sussex.

4. A completely pointless chorizo and mango tortilla combo from Pinchito Tapas in Shoreditch.

5. A Goan fish curry from The Bombay Brasserie, which had been reduced to a few chunks of halibut in a harsh, discordant, unbalanced sauce.

Next, please

If all you want for Christmas is a brand new place to dine, you're in luck. Here are some places to try soon. Just opened L'Autre Pied, modern European dining from the Pied à Terre team. Tom's Place, Mr Aikens' new eco-friendly fish and chipper.

Opening any minute

Rowley Leigh and Charlie McVeigh's Le Café Anglais in Whiteley's in Queensway. Alain Ducasse's flagship fine diner in the Dorchester. Water House, a new eco-restaurant in Hoxton from the Acorn House team.Sake No Hana, Alan Yau's new upmarket Japanese in St James's Street.Vineet Bhatia's first Urban Turban in Westbourne Grove, which will specialise in Mumbai street food.

Opening next year

By the end of 2008 we'll all be in chains. Nahm's David Thompson is planning a chain of Thai street diners, Long Chim, while Jamie Oliver branches out with a chain of tratts beginning in Bath and Brighton.

Contacts

Alain Ducasse at the Dorchester
53 Park Lane, London W1,
Tel: 020 7629 8866.

L’Autre Pied
5-7 Blandford St, London W1,
Tel: 020 7486 9696.

Bincho
Yakitori 2nd Floor, Oxo Tower Wharf, Barge House St, London SE1,
Tel: 020 7803 0858.

The Bombay Brasserie
Courtfield Close, Courtfield Rd, London SW7,
Tel: 020 7370 4040.

Le Café Anglais
151 Queensway, London W2.

The Carpenter’s Arms
91 Black Lion Lane, London W6,
Tel: 020 8741 8386.

East Beach Café
Littlehampton, West Sussex,
Tel: 01903 731 903.

Le Gavroche
43 Upper Rook St, London W1,
Tel: 020 7408 0881.

Great Queen Street
32 Great Queen St, London WC2,
Tel: 020 7242 0622.

Haozhan
8 Gerrard St, London W1,
Tel: 020 7434 3838.

Hereford Road
3 Hereford Rd, London W2,
Tel: 020 7727 1144.

Hibiscus
29 Maddox St, London W1,
Tel: 020 7629 2999.

Kiasu
48 Queensway, London W2,
Tel: 020 7727 8810.

Kiasu
48 Queensway, London W2,
Tel: 020 7727 8810.

The Kingham Plough
Kingham, Chipping Norton, Oxfordshire,
Tel: 01608 658 327.

Kitchin
78 Commercial Quay, Leith, Edinburgh,
Tel: 0131 555 1755.

Magdalen
152 Tooley St, London SE1,
Tel: 020 7403 1342.

Marco
Stamford Bridge, Fulham Rd, London SW6,
Tel: 020 7915 2929.

Momo
25 Heddon St, London W1,
Tel: 020 7434 4040.

The Narrow
44 Narrow St, London E14,
Tel: 020 7592 7950.

One-O-One
101 William St, London SW1,
Tel: 020 7290 7101.

Pearl Liang
8 Sheldon Square, London W2,
Tel: 020 7289 7000.

La Petite Maison
54 Brooks Mews, London W1,
Tel: 020 7495 4774.

Pinchito Tapas
32 Featherstone St, London EC1,
Tel: 020 7490 0121.

Purnell’s
55 Cornwall St, Birmingham,
Tel: 0121 212 9799.

Rhodes W1
The Cumberland, Great Cumberland Place, London W1,
Tel: 020 7479 3737.

Sake No Hana
23 St James’s St, London SW1,
Tel: 020 7925 8988.

Scott’s
20 Mount St, London W1,
Tel: 020 7495 7309.

Snazz Sichuan
New China Club, 37 Chalton St, London NW1,
Tel: 020 7388 0808.

St Alban
4-12 Regent St, London SW1,
Tel: 020 7499 8558.

Texture
34 Portman Square, London W1,
Tel: 020 7224 0028.

Theo Randall at the InterContinental
1 Hamilton Place, London W1,
Tel: 020 7318 8747.

Tom’s Place
1a Cale St, London SW3,
Tel: 020 7351 1806.

Viet Grill
53 Kingsland Road, London E2
Tel: 020 7739 6686.

Water House
10 Orsman Rd, London N1.

Wild Honey
12 St George St, London W1,
Tel: 020 7758 9160.