Below, we have put together a simple standing charge calculator so you can work out how much your standing charge is costing you per day, week, month and year for both gas and electricity.
To use it, all you need to know is your standing charge for your gas and electricity supply (or you can enter 0 if you only want to look at one!). You will be able to find this on your latest energy bill.
What are standing charges?
A standing charge is a daily amount added to your gas and electricity bills.
If your energy deal includes a standing charge, you are charged that daily rate regardless of how much energy you use. Whether that is 0 kWh or 1,000 kWh per day, your standing charge will remain constant. It’s a good way for energy suppliers to guarantee income, but it can also provide a real sting to the customer.
The purpose of the standing charge is to help cover operator costs. This is for things like supplying the gas or electricity to your home, maintaining those supply lines and taking meter readings.
Do I have to pay a standing charge?
Although most tariffs will include a daily standing charge, this is not always the case. Zero standing charge tariffs are not as common but are available.
As you might expect, there are advantages and disadvantages to the standing charge.
Advantages and disadvantages of paying a standard charge
Looking at only one aspect of an energy quote will not be enough to work out if you are getting a better deal.
It is not uncommon for lower standing charge rates to lead to higher price per unit costs. Although not always the case, the inverse is also often true. A higher daily rate equals a lower price per kWh of gas or electricity.
Personal circumstances will differ, and a deal that suits one person may not be the best for another.
Here are some of the advantages that apply to most people:
You will get a better rate on your unit price. Each kWh for gas and electricity will likely be lower when paying a standard charge. This will differ between suppliers, but in general, a higher daily charge will mean a lower KWh rate.
Higher and medium energy users usually find these deals to be the cheapest.
Disadvantages of paying a standing charge:
You might be paying a bill for an unoccupied building. Even if you do not use gas or electricity, you will still pay the daily rate. T
his often affects holiday homes that are left dormant for large parts of the year. Savings made on lower kWh costs are cancelled out by higher standing charge costs.
A property left empty for eight months of the year is still paying eight months’ worth of a daily standing charge.
If you are a low energy user, not paying a standing charge could significantly lower your bill. Although you will be paying a higher cost per KWh, you could be saving hundreds of pounds per year in daily fees.
Should I look to avoid a standing charge?
Separating the two pricing methods can be difficult, especially when trying to make sure you are on the best deal. You should be able to find your estimated annual usage from your current supplier and then add this to your standing charge over a year.
Looking at how you expect to use energy as well as the usage costs will help work out which deal is best for you. The quickest way to do this is through a price comparison site.
Using online tools can help bundle all of this information together and provide an annual estimated cost. A comparison will provide the cheapest deal based on your expected usage patterns and make sure that you do not overpay for your energy.
