UK plans to remove household gas standing charges

The UK government plans to ask energy regulator Ofgem to remove household gas standing charges in 2027 or as soon as possible afterward, shifting the costs into the price charged for each unit of gas. The Treasury estimates that 60% of households will save about £45 a year on average, while warning that some households may not benefit automatically. Standing charges are fixed daily fees paid regardless of how much gas a household uses. They cover costs associated with maintaining and connecting the supply, and currently amount to about £108 a year for a typical household, according to the Treasury. Under the proposal, those costs would be included in the gas unit rate instead. The change is not expected to reduce every household’s bill. Because the costs would be spread across gas consumed, households using less gas could pay less overall, while some high-use households could pay more. The Treasury says it will set out targeted mitigation for a small number of households, but has not yet detailed who would qualify or what support would be provided. Uswitch estimates, using current rates, that a household consuming 7,000 kilowatt-hours of gas annually could be about £40 better...