Energy: Standing Charges
The question
To ask the Secretary of State for Energy Security and Net Zero, what steps his Department is taking to help reduce regional inequalities with standing charge rates.
Answered by Martin McCluskey
Regional variations in standing charges arise from differences in electricity distribution costs and reflect the different costs of maintaining and upgrading the distribution network in a specific area, and the number of consumers those costs are spread across.
The Government is committed to bearing down on standing charges. Ofgem has also been working to ensure that domestic consumers can choose tariffs with lower standing charges. Ofgem’s consultation on these proposals closed on 23 October 2025, and they will provide a further update in due course.
In addition, through their Cost Allocation and Recovery Review, Ofgem has also been reviewing how ‘fixed’ costs, which tend to be funded through standing charges, should be recovered in the future energy system. This includes whether those fixed costs could be recovered in more progressive ways, and we are working closely with the regulator on this.
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