What is the standing charge on my energy bill?

When your energy bill comes through each month, either in the post, via email or to your online account or app, how much time do you actually spend checking it over? It’s likely that we’re all guilty of scanning the bill, seeing how much we need to pay or the amount that will automatically come out of our bank account and then placing the bill to one side. But there could be some important information in this document and it can be used to check whether you’re being charged the right amount by your provider.

While it’s obvious that you need to pay for the energy that you’ve used to light and  heat your home, did you know that you also pay an additional daily fee to your energy provider for keeping you connected to a supply? This is known as a standing charge.

What does ‘standing charge’ mean on my energy bills?

Each energy provider will have their own template and layout for an energy bill. This means that while each bill may look slightly different, generally they will all contain the same information. This includes a summary of how much you have paid or owe, plus whether you’re in credit or debit (credit on your account is when you have overpaid and debit is when you’ve underpaid and owe more money to your provider).

Once you’ve been through the payment summary, the next couple of pages of your bill will summarise the tariff you’re on and how much gas and electricity you’ve used in the time since your last bill (usually one to three months) in kilowatt hours (kWh). It is at this point that you may see a fee known as a standing charge, but what exactly does this mean?

The standing fee is a daily charge that is added to your bill to cover the costs incurred by energy providers for keeping you connected to an energy supply, such as maintenance costs and the time it takes for meter readings to be taken if you don’t have a smart meter. Therefore, your bill will likely show the amount of kWh you’ve used and how much you pay per kWh, as well as the daily standing charge and how many days the bill covers. We’ve created a mock-up energy bill below so you can get an idea of where it might be located.  

For instance, the bill above shows that over a period of three months, you’ve used 776 kWh of electricity. At 18.03 pence per kWh, you would owe a total of £139.91. Then on top of this, you would owe the daily standing charge. In the example above, the standing charge is 21.56 pence per day. Over a period of 94 days, you would therefore owe a standing charge fee of £20.268, bringing your total bill to £168.17. The standing charge stays the same regardless of how much energy you use.

What is the average daily standing charge for electricity?

The average daily standing charge for electricity in the UK is around 20 pence, however you could pay anything from 5p to 60p depending on your energy provider.  

What is the average daily standing charge for gas?

The average daily standing charge for gas in the UK is around 24 pence, however this could be as low as 10p and as high as 80p depending on your provider.

Do all energy companies have standing charges?

Most energy companies in the UK do require a standing charge, however there are some providers that don’t charge this additional fee. You should be careful though, as generally providers who set this fee to zero often increase the price per kWh of gas and electricity, so you’ll likely be paying the same amount as someone who does pay the standing charge.

Does my smart meter include a standing charge?

A smart meter often comes with a small digital screen that you can use to monitor your daily energy usage. The smart meter will show your standing charge, whether you do or don’t use energy that day. This means that when you look at your daily energy usage and cost, the standing charge should automatically be included in the fee.

Sources:

https://www.moneysavingexpert.com/utilities/electricity-standing-charge/

https://www.utilitybidder.co.uk/what-is-the-standing-charge-on-my-energy-bill/

https://www.uswitch.com/gas-electricity/guides/energy-standing-charges/