Energy: Standing Charges

Standing charges cover the costs energy suppliers take on to provide consumers with electricity. Although they are a commercial matter for suppliers, and are regulated by Ofgem, we know that too much of the burden of the bill is placed on standing charges.

The Government has worked constructively with the regulator on the issue of standing charges, and we are committed to lowering the cost of them. Ofgem’s recently published discussion paper sets out the options for how standing charges could be reduced, including by moving some supplier operational costs off standing charges onto the unit rate, increasing the variety of tariffs available for consumer in the market, and in the longer term, reviewing how system costs are allocated. We will continue to support Ofgem in this work and ensure that standing charges are reduced.