Every energy billpayer in England, Scotland, and Wales will be given the option to switch to a low standing charge tariff by the end of January, as announced by the energy regulator Ofgem. This decision follows reactions regarding fixed daily fees that many consumers say they cannot control, which cover costs associated with connecting to gas and electricity supplies.
The proposed tariffs will feature lower standing charges, with higher costs per unit of energy. While this addresses some consumer concerns, charities have stated that it does not tackle the broader issue of high energy bills. The proposals are considered less comprehensive than earlier suggestions and include a requirement for tariffs to have a minimum usage threshold.
Ofgem emphasized that standing charges are necessary to cover transport and supply security, as well as to fund the energy network. Starting October 1, average standing charges are set to be 53.68 pence per day for electricity and 34.03 pence for gas for those on direct debit, although these charges vary by location. In some areas, like North Wales and Merseyside, electricity charges could reach nearly 70 pence per day.
Responses from stakeholders reveal mixed views. Tim Jarvis from Ofgem noted the intention to provide more choice without disadvantaging customers. The planned changes will make low standing charge tariffs available to all customers, regardless of payment method, aiming to give households the option they desire.
However, charities caution that these changes might not effectively reduce overall energy costs, with some expressing concern that the introduction of additional tariffs could lead to confusion among consumers. The new proposals will undergo consultation before any final decisions are enacted.
Source: https://www.bbc.com/news/articles/cx20dwzgq51o?at_medium=RSS&at_campaign=rss