Wed, 15 Oct 2025

Wed, 15 Oct 2025 Energy standing charge plans could backfire, MPs told

Bosses of the UK's biggest energy suppliers were quizzed by MPs about support for their customers as prices rise.

* The plan would require all suppliers to offer at least one tariff with lower standing charges, but higher unit prices.
* Industry leaders questioned whether this would solve the problem of unaffordable energy costs for some customers.
* Many called for a social tariff that provides discounts for low-income households, paid for by other billpayers.
* Energy UK and Ofgem's price cap have led to increased debt among customers, with over £4.4bn owed to suppliers.
* The government is considering rebalancing energy policy costs to lower electricity bills, but this could increase gas prices. The Energy Security and Net Zero Committee heard from energy bosses that:
* Standing charges are not the main issue for customers; rather it's unaffordable energy costs.
* A social tariff or other measures to support low-income households would be more effective.
* The price of electricity compared to gas is a disincentive to switching to electric heating.
* Shifting policy costs from electricity bills to gas could save households using air source heat pumps up to £7,000 over 15 years. The government's climate adviser has recommended removing policy costs from electricity bills to encourage the use of electric technologies. However, this would result in higher bills for households that use gas for heating. The Chancellor will set out her economic plans in the second Budget on November 26, which includes measures to help reduce costs for families.
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