This could lower the standing charge rate for millions of users.
A standing charge is one of the costs that is included in your electricity and gas bill. It is also included in the energy price cap.
Why is the standing charge controversial?
Your energy supplier will charge you a standing charge cost each day, even if you do not use any energy on that day.
News. Energy standing charges finally to fall?
Delighted the Government (h/t @Ed_Miliband) has listened and is consulting on shifting the Warm Home Discount costs off the standing charge and onto the unit rate. This is exactly the right direction. You can respond to the…
— Martin Lewis (@MartinSLewis) December 8, 2025
Martin Lewis says: “The current standing charge is a moral hazard that disincentivises lower usage and keeps bills high for people who use very little energy. It’s the biggest single cause of complaint I get about energy bills, by a mile.
“Paying £300+ a year simply for the facility of having energy is too much. It also penalises older people who don’t use gas in the summer yet still pay for it every day.”
It covers the costs to:
- move electricity or gas through cables and pipes to homes and businesses
- pay towards supplier business costs, for example call centres
- pay towards some government social and environmental schemes such as Warm Home Discount
Reacting to the announcement on X, Martin, founder of MoneySavingExpert.com , says: “Energy standing charges finally to fall? Delighted the Government has listened and is consulting on shifting the Warm Home Discount costs off the standing charge and onto the unit rate. This is exactly the right direction. You can respond to the consultation here.
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“If implemented, it would remove a typical £39 a year from the standing charge (roughly split between gas and electricity), starting next April. That timing aligns with the planned reduction in unit rates announced in the Budget (via moving some other policy costs into general taxation).
“Overall, assuming all else stays equal (which it won’t, as I’ve written before), this means the standing charge should fall, and the unit rate should still fall too, because the added cost from this shift is smaller than the reduction from removing the policy costs.
“It’s only a baby step, but it’s a step in the right direction. I now hope Ofgem follows this route in its long-term consultation on the future structure of energy bills.
“I’ve pushed on this for years, and it’s good to finally see some (albeit small) movement. So do feed in to the consultation to ensure it happens.”