Energy: Standing Charges

Department for Business, Energy and Industrial Strategy written question – answered on 10th September 2020.

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Photo of Gareth Thomas Gareth Thomas Shadow Minister (International Trade)

To ask the Secretary of State for Business, Energy and Industrial Strategy, what discussions he has had with the Gas and Electricity Markets Authority to require all Energy providers to offer at least one Zero Standing Charge tariff for each fuel they supply; and if he will make a statement.

Photo of Kwasi Kwarteng Kwasi Kwarteng The Minister of State, Department for Business, Energy and Industrial Strategy

Setting energy tariffs is a commercial matter for individual suppliers. There are fixed costs in the supply of gas and electricity, such as meter costs and providing an emergency service, so any tariff with a zero standing charge would need to levy the fixed cost via a higher unit rate. This could benefit some low consumption households but could also make higher consumption households worse off, such as those with children or people who need to use more energy due to ill health. The price cap on default and prepayment meter tariffs ensures that all households pay a fair price for gas and electricity.

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