UK energy standing charge cap: who saves most?
A proposed cap on standing charges could cut the fixed daily cost of gas and electricity — but it won’t benefit everyone equally. Here’s who’s most likely to gain, who may not, and how to check your own bills.
- Fast explanation of what a standing charge cap means in practice
- Two realistic household scenarios with estimated numbers (and assumptions)
- A decision table and checklist to help you judge if you’d be better off
Estimates shown are illustrative and depend on your tariff, region, meter type and payment method. Always check your unit rates and standing charges before switching.
Fast answer: a standing charge cap usually helps low-use homes most
A cap on standing charges lowers the fixed daily cost you pay for gas and/or electricity. That tends to benefit households that use less energy (because a larger share of their bill is fixed). But suppliers may respond by raising unit rates (the price per kWh) to recover revenue, which can reduce or reverse the benefit for higher-use households.
Key point: Whether you save depends on the trade-off: how much your standing charge falls versus how much (if at all) your unit rate rises. The best way to judge is to compare your bill on your annual usage, not just the daily charge.
Most likely to save
Low energy users, single occupants, small flats, and homes that keep usage down (or are empty for parts of the year).
May save a little
Typical-use households where standing charges fall and unit rates rise only slightly (or not at all).
Could pay more
High energy users (especially gas-heated larger homes) if the cap leads to noticeably higher unit rates.
If you’re unsure where you sit, jump to the comparison table and scenarios below, then run a whole-of-market comparison using your postcode and usage.
What a standing charge cap could change (and what it can’t)
Your energy bill is usually made up of:
- Standing charge (pence per day)
- A fixed amount you pay each day to be connected to the network and cover certain supplier costs. You pay it even if you use no energy.
- Unit rate (pence per kWh)
- The price you pay for each unit of energy used. This is what rises and falls with your consumption.
Important caveat: A standing charge cap does not automatically mean your total bill falls. If suppliers increase unit rates to compensate, some households could see smaller savings or higher costs overall.
UK-specific factors that affect your standing charge
- Region: Standing charges vary by distribution region (e.g., London vs North Wales).
- Payment method: Direct Debit vs standard credit vs prepayment can have different rates.
- Meter type: Single-rate, Economy 7 (two-rate), smart meters and legacy arrangements can affect pricing.
- Fuel: You may pay one standing charge (electric only) or two (gas + electric).
Check deals for your home (whole of market)
If standing charges change, the best response is still the same: compare using your postcode and (ideally) your annual usage. We’ll show estimated costs across available tariffs so you can judge the impact.
Tip: For the most accurate comparison, have your latest bill to hand and look for your kWh usage (annual or monthly) and whether you’re on single-rate or Economy 7.
Two scenarios: how a standing charge cap could affect households
These examples are illustrative. They show the key trade-off (lower standing charge vs potentially higher unit rate). Actual prices depend on supplier, tariff, region, meter type and payment method.
Scenario A: low-use flat (more likely to benefit)
- Electricity use: 1,800 kWh/year (single-rate)
- Current standing charge: 60p/day
- Current unit rate: 28p/kWh
- Example cap outcome: standing charge drops to 30p/day, unit rate rises to 29p/kWh
Estimated annual cost now: (0.60×365) + (0.28×1,800) = £723
Estimated annual cost with cap: (0.30×365) + (0.29×1,800) = £632
Estimated difference: £91 less per year
Scenario B: higher-use family home (benefit can shrink or reverse)
- Electricity use: 4,200 kWh/year (single-rate)
- Current standing charge: 60p/day
- Current unit rate: 28p/kWh
- Example cap outcome: standing charge drops to 30p/day, unit rate rises to 31p/kWh
Estimated annual cost now: (0.60×365) + (0.28×4,200) = £1,395
Estimated annual cost with cap: (0.30×365) + (0.31×4,200) = £1,412
Estimated difference: £17 more per year
What to take from the scenarios: the lower your usage, the more the standing charge matters. The higher your usage, the more sensitive your bill becomes to changes in the unit rate.
Who saves most under a standing charge cap? (Quick comparison)
This table is a practical guide. It assumes a cap reduces standing charges and that some tariffs may increase unit rates. Your real outcome depends on your tariff structure and annual consumption.
| Household type | Typical usage | Why a cap may help | Main risk / watch-out |
|---|---|---|---|
| Low-use single occupant | Electric ~1,500–2,200 kWh/yr | Standing charge is a larger share of the bill | If unit rates rise a lot, savings reduce |
| Typical-use household | Electric ~2,700–3,600 kWh/yr | Can still benefit if unit rates stay similar | Need to compare on annual cost (not just daily charge) |
| High electricity use | Electric 4,000+ kWh/yr | Standing charge cut helps, but less important overall | Unit rate increases can outweigh the cap |
| Gas-heated, larger home | Gas 12,000–20,000+ kWh/yr | Lower fixed gas charge can help year-round | A higher gas unit rate can add up quickly in winter |
| Second home / long periods away | Very low usage for months | Paying for connection becomes less expensive | Check tariff terms; some deals suit steady use better |
Decision checklist: is a standing charge cap likely to suit you?
- You may benefit if your usage is low, you live alone, or your home is empty at times.
- You may benefit if standing charges are a big chunk of your bill (you can see this on your bill breakdown).
- Be cautious if your home uses lots of gas in winter (unit rate changes matter more).
- Be cautious if you’re on Economy 7: you need to check day and night unit rates (and both standing charges if applicable).
- Always check your payment method and region — these can change the numbers materially.
A quick way to test it using your own bill
- Find your standing charge (p/day) and unit rate (p/kWh) for each fuel.
- Note your annual kWh usage (or estimate from the last 12 months).
- Estimate annual cost: (standing charge × 365) + (unit rate × kWh).
- Repeat using an example capped standing charge and a plausible unit-rate change.
- Then compare real tariffs available to you by postcode (standing charges can differ by supplier).
If you don’t know your kWh usage, your bill will often show it near “Electricity (kWh)” or “Gas (kWh)”. Smart meter in-home displays can help too, but billing data is best.
Costs, exclusions and common pitfalls to watch
Standing charges are just one part of your overall energy cost. These are the most common ways people get caught out when pricing changes.
1) Unit rate increases
If the standing charge is capped, suppliers may increase the unit rate. High-use homes are most exposed.
2) Economy 7 complexity
Economy 7 has two unit rates. A small shift in day rate can outweigh a cheaper standing charge if you use most electricity in the day.
3) Exit fees on fixes
Fixed tariffs can include exit fees. If you’re considering switching, check your contract terms first.
Payment method and debt considerations
- Prepayment meters: prices can differ from Direct Debit. If you’re on prepay, compare like-for-like.
- Owing money to your supplier: you can often still switch, but debt rules may apply and it can complicate the process.
- Direct Debit changes: a tariff change doesn’t instantly change your DD amount; suppliers may review it based on usage and account balance.
Don’t judge a deal by standing charge alone
A “low standing charge” tariff can still be expensive if the unit rate is high. For a fair comparison:
- Compare on estimated annual cost for your kWh usage.
- Check whether prices are variable or fixed (and for how long).
- Confirm your meter type and payment method match the quote.
FAQs: standing charge cap and your UK energy bill
1) What is a standing charge on UK energy bills?
It’s a fixed daily fee for being connected to the gas and/or electricity network. It’s charged per fuel and is paid even if you use no energy.
2) If standing charges are capped, will everyone pay less?
Not necessarily. If unit rates rise to compensate, higher-use households may see smaller savings or potentially higher overall bills. The only reliable test is comparing estimated annual costs using your kWh usage.
3) Would a cap apply to both gas and electricity standing charges?
It depends on the policy design. Some proposals focus on electricity standing charges (because nearly all households use electricity), while others consider both fuels. Check the exact scope and whether it differs by payment method or meter type.
4) Do standing charges vary across the UK?
Yes. Standing charges vary by region (network area), and can also vary by payment method (Direct Debit, standard credit, prepayment) and tariff. Always compare using your postcode.
5) What about households with very low usage or an empty home?
They are often among the biggest beneficiaries of lower standing charges because the standing charge is a large share of what they pay. However, check any tariff rules and consider whether you can safely reduce usage further (e.g., frost protection in winter).
6) Does a standing charge cap affect the Energy Price Cap?
They’re related but not the same. Ofgem’s Energy Price Cap limits the maximum unit rates and standing charges suppliers can charge on standard variable/default tariffs (set for a period). A “standing charge cap” proposal could be an additional or different constraint, depending on how it’s implemented.
7) I’m on a fixed tariff — would this change my prices?
Usually, your fixed tariff prices remain as agreed for the fix term unless your contract allows changes in limited circumstances. If you want to switch, check for exit fees and compare the full annual cost.
8) How can I reduce my standing charge today?
You can’t remove it on most mainstream tariffs, but you can compare tariffs that have lower standing charges (often with different unit rates). The best approach is to compare based on annual usage and choose the tariff that minimises your estimated yearly cost.
Trust, methodology and sources
Page details
- Written by: EnergyPlus Editorial Team
- Reviewed by: Energy Specialist
- Last updated: February 2026
How we assess “who saves most”
We focus on the bill mechanics that determine whether a standing charge cap reduces total costs:
- Standing charge share: lower-use households pay a bigger proportion of their bill as fixed charges.
- Unit-rate sensitivity: higher-use households are more affected by a change in p/kWh.
- UK tariff variation: we note differences by region, payment method and meter type.
The scenario numbers on this page are worked examples designed to show the trade-off. They are not predictions and should not be treated as a quote.
Limitations and what could change
- Any cap would be defined by policy and could vary by fuel, payment method, or customer type.
- Suppliers may adjust unit rates, discounts, or tariff structures in response.
- Economy 7 and multi-rate tariffs add complexity; always compare using the right meter profile.
- Network charges and other cost components can change over time, affecting both standing charges and unit rates.
Want to see how standing charges affect your bill?
Run a whole-of-market comparison using your postcode and get estimated annual costs you can actually compare.
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