Energy: Fees and Charges

(asked on 14th March 2022) - View Source

Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he is taking to monitor above inflation increases in standing charges by energy companies; and what assessment he has made of (a) the reasons for increasing those charges above the rate of inflation and (b) the impact on (i) consumers and (ii) energy companies.


Answered by
Greg Hands Portrait
Greg Hands
Minister of State (Department for Business and Trade)
This question was answered on 17th March 2022

The setting of energy tariffs including the standing charge is a commercial matter for individual suppliers. The standing charge is a daily flat rate passed on to consumers which covers the costs energy suppliers incur to provide a live supply to each household. It includes charges from network companies for using pipes and power lines to carry gas and electricity supplies, the maintenance and installation of meters and billing and accounting. A small proportion of the standing charge also goes towards Government initiatives that help vulnerable households and reduce emissions.

For millions of households the level of the standing charge is protected by the energy price cap rate set by Ofgem. The energy unit rate and the standing charge together for a supplier’s default and standard variable tariffs must not exceed the level of the price cap. For consumers looking for a new fixed deal for the energy, suppliers can offer a range of tariffs including some with a low or even a zero standing charge and a higher energy unit rate to attract low energy users.

Reticulating Splines