Guide to energy standing charges

Take a look at your energy bill and you’ll notice that, as well as gas and electricity usage, there’s a ‘standing charge’.

But what exactly is a standing charge? And why should you pay it? We’ve got the answers.

Take a look at your energy bill and you’ll notice that, as well as gas and electricity usage, there’s a ‘standing charge’.

But what exactly is a standing charge? And why should you pay it? We’ve got the answers.

Peter Earl

From the Energy team

minute read

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Posted 11 FEBRUARY 2020

What’s a standing charge?

A standing charge is added to most gas and electricity bills. It’s a fixed daily amount that customers have to pay, no matter how much energy they use. It even applies to properties that are unoccupied for part of the year – a holiday home, for example.

A standing charge covers the costs your energy supplier incurs to get gas and electricity to you. These costs include:

using and maintaining the energy networks, wires and pipes that carry gas and electricity across the country to your home
keeping your home connected to the energy network
carrying out meter readings
payments towards government initiatives that help vulnerable households, and reduce CO2 emissions.

If you have a dual fuel energy bill, you’ll pay both a gas standing charge and an electricity standing charge. These are listed on your energy bill at a daily unit rate.

How much do I have to pay for a standing charge?

The daily standing charge depends on your energy supplier and, over the course of a year, can add up to a substantial sum.

Typical standing charges range from:

electricity – 5p to 60p per day
gas – 10p to 80p per day

Ofgem proposed changes to curb standing charges in 2016, but most energy providers continue to add them.

There are, however, talks of a cap on the standing charge, which currently averages about £156 per year. This could benefit low-income households in particular, with an estimated saving of up to £100 per year.

Are there energy suppliers who don’t have a standing charge?

There are a few energy suppliers who don’t set a standing charge, or set a rate of £0 on your bill.

What are the advantages of a tariff with zero standing charges?

Advantages of an energy tariff without a standing charge include:

you only pay for the energy you use
they can be good for occasional-use properties, such as holiday homes.

What are the disadvantages of a tariff with zero standing charges?

Disadvantages of a tariff that has no standing charge include:

the energy unit rates are typically higher
medium to high energy users may end up paying more for their energy

Where can I compare different energy tariffs?

Right here at Compare the Market. Start a quote with us and you can compare a range of tariffs and energy suppliers. Your quote results will show you a breakdown of each tariff, including the unit rates, standing charges and any exit fees.

Compare energy prices today, and see if you can save money by switching to a cheaper deal.