'Removing gas standing charges could help in the longer term': Uswitch responds to Treasury announcement.
Richard Neudegg, director of regulation at Uswitch.com, comments: “Moving gas standing charges onto the unit rate is a sensible idea for the longer term.
“Paying a daily gas standing charge can grate for households that use very little gas, and can feel illogical over the summer or when homes have the heating off.
“Households that use less gas, such as those living in smaller homes, should benefit when this comes in. It will also give relief to those who have switched to electric heating but kept a gas connection and find themselves paying a standing charge for a service they don’t use for heating.
“But these costs won’t disappear. They’ll move into the price of each unit of gas, meaning that those using a lot of gas could be worse off.
“Based on current rates, a household using 7,000 kWh of gas a year could be about £40 better off under these changes, while a home using 14,000 kWh could be £25 worse off.
“The Treasury says these changes will happen ‘in 2027 or as soon as possible after’. In the meantime, consumers face a difficult winter with further price cap increases on the horizon. We’ll wait to see how the energy package in the budget looks as a whole later today.”
-ENDS-
Notes to editors
The average gas standing charge is 29.68p a day, or about £108 a year, based on Ofgem price cap figures for 1 October to 31 December for Direct Debit customers, including 5% VAT.
The illustration is a Uswitch calculation, not a forecast. It assumes the full £108 moves into gas unit rates, which would raise the rate by roughly 0.94p per kWh, from 7.97p to about 8.9p. It is based on Ofgem’s typical household gas use of 11,500 kWh a year and ignores regional differences and VAT.
