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18 Jun 2020
Adam Bate

Business energy standing charges


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How much are standing charges adding to your energy bills?

What are business energy standing charges?

When looking for a new energy package, you will come across the term standing charge. The business electricity standing charge is what you will pay each month to have your electricity supplied to your business as well as keeping you connected to the main energy grid. The business gas standing charge covers similar costs for the provision of your gas supply.

Standing charges can vary significantly according to your circumstances, but by how much depends on the type and duration of package you sign up to. To help you better understand this charge and help you get the best possible deal, we have provided answers to some of the most common questions surrounding standing charges.

As we have shown, business energy standing charges are fees you are required to pay that ensure you remain connected to the power grid. The majority of energy contracts include a standing charge, with variations in price due to factors including what type of business energy contract you are on or are looking to enter.

Almost every business energy package comes with a standing charge – meaning you just have to make sure you are paying the least amount possible. You may find some suppliers claiming to offer energy deals with no standing charge but they often feature higher-than-normal tariffs. So just because there’s no standing charge doesn’t mean you’ll be paying less per month.

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How much are business gas standing charges?

Business gas standing charges depend on various factors, such as how much gas you use, the length of the contract you wish to enter and whether you need supply to multiple locations or not. It is therefore often difficult to provide an accurate quote without first having various information about your business.

You should expect to pay anything from between 19p to £6 per day, this figure depends on your annual consumption. The charge increases if your energy consumption does – and you will have to pay this charge for the duration of your contract.

How much are business electricity standing charges?

As has been stated, there are currently no deals featuring for business electricity without a standing charge. Therefore, the prices being offered by UK energy suppliers are similar, often only varying depending on your businesses’ specific requirements.

For electricity, the standing charge is for the maintenance of the national grid and the physical supply of electricity to your premises. For microbusinesses, the daily standing charge will be around 26p-30p. This figure falls to 24p-26p for small businesses and 21p-23p for medium-sized businesses. As you will have noticed, the daily amount decreases when the size of your business increases. That makes it important to know the size of your business before entering a new agreement. If you go in blind, you could end up being overcharged.

Are energy deals with no standing charge available?

The answer to this question is both yes and no. Most energy suppliers will insist on a daily commercial gas or electricity standing charge. Therefore, if you are looking to enter a new business energy deal, it is highly likely that you will have to pay.

However, if you are looking for the cheapest energy supplier without a standing charge, you may find some energy suppliers claiming to have eliminated the standing charge. Whilst tempting, you must exercise caution with such deals. This is because, energy packages with no standing charge often instead feature higher kWh tariffs than those that include a standing charge – meaning you could well end up paying much more for your energy.

What are the pros and cons of no standing charge business energy deals?

As with all energy packages, each one has its own advantages and disadvantages. No standing charge business energy deals are no different – and you are therefore recommended to look into the various pros and cons of each before choosing what is right for your business.

For example, one advantage of a no standing charge business gas deal is that you only pay for the gas that you use. This is particularly useful for seasonal businesses that may not operate at all for long periods of the year.

This is of course in stark contrast with a deal featuring a standing charge that will mean you paying this fee every day, whether you are actually using any gas or not.

As already mentioned, deals featuring no standing charge often feature higher tariffs – meaning you will be paying more for each unit of gas than you would on a package with a standing charge.


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