Ofgem launched a call for input on standing charges in November 2023, asking for views on the daily fees and on possible alternatives to them1. The call for input closed in January 20242.
Standing charges are a daily charge that energy customers pay even if they use no energy1. Ofgem describes them as recovering the costs of providing and maintaining the wires, pipes and cables that deliver power to a customer's door, along with the staff and buildings required for the energy business to function1. One account of the review says it closed after receiving more than 20,000 responses2. The same account states that the average UK household pays more than £300 per year in standing charges2.
The call for input was the first step in a sequence of Ofgem work on the issue. In August 2024 Ofgem published an options paper on ways to reduce standing charges; in February 2025 it launched a further consultation asking for views on a zero standing charge option within the energy price cap; in July 2025 it published a summary of responses and its planned next steps; and in September 2025 it announced it planned to require suppliers to offer customers at least one lower standing charge tariff for all payment methods in all regions and to smart and traditional meter customers1. A one-year pilot of lower standing charges was launched starting in April 2026, later put back to June 2026, to be offered first by four of the big suppliers with a limited number of customers able to sign up1.
The charges have risen sharply over the period covered by the review. Electricity standing charges jumped by more than 80% in April 2022, largely due to supplier of last resort costs after many smaller suppliers went out of business, and rose by more than 10% in April 2023 and April 20241. Average standing charges under the October to December 2026 direct debit price cap are 54.8 pence a day for electricity and 29.7 pence a day for gas, or 84.5 pence a day for dual fuel customers1. Standing charges are expected to make up 18% of a total dual fuel bill at typical consumption under that cap, down from a peak of 24% in the third quarter of 20241.
| Consumption level | Share of electricity bill | Share of gas bill |
|---|---|---|
| Low (25th percentile) | 32% | not reported |
| Medium (median) | 23% | 13% |
Source: House of Commons Library, citing Ofgem price cap data1. The briefing gives the low-consumption electricity figure and the medium figures for both fuels; it does not give a low-consumption gas figure in the text available1.
Why it matters for households
A standing charge is fixed, so it takes a larger share of the bill for a home that uses little energy and a smaller share for one that uses a lot1. At the low consumption level for electricity, standing charges make up 32% of an annual bill, meaning one quarter of consumers face standing charges worth at least that share of their electricity bill1. For a household with solar panels, the charge is the same as for one without, because it applies regardless of how much energy is drawn from the grid2. Reducing the standing charge would mean fixed costs would have to be recovered through higher unit prices, but the maximum unit rate is also set by the price cap1. Ofgem has acknowledged that the way it sets the cap strongly influences how retail suppliers recover fixed costs1. Alternative tariffs outside the cap exist with no standing charge but a higher unit price1.
What happens next
The call for input itself closed in January 20242. Ofgem's later steps are dated: an options paper in August 2024, a consultation on a zero standing charge option in February 2025, a summary of responses and next steps in July 2025, and a September 2025 announcement of a requirement for suppliers to offer a lower standing charge tariff1. A one-year pilot of lower standing charges began in April 2026, later put back to June 20261.
Sources2 cited
- Energy standing charges - House of Commons Library, commonslibrary.parliament.uk
- What is a standing charge and why do we have them? 2026, sunsave.energy