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When you switch business energy, you’ll most likely be required to pay a daily standing charge to your supplier.
If your business wants to avoid this charge, there are options available. If you have a low energy usage or you use gas and electricity infrequently, you could save money by switching to a no standing charge tariff.
Here, British Business Energy explains what standing charges are and the pros and cons of a no standing charge tariff.
What is a standing charge?
A standing charge is a fixed daily amount you are required to pay no matter how much energy you use. This is added automatically to your energy bill and is essentially the fee you pay for your business electricity or business gas to be supplied to your property.
Energy suppliers use the standing charge to cover the costs of keeping your property connected to the main supply and carrying out meter readings.
How much are standing charges for business energy customers?
Typical daily standing charges for business electricity range from 15p to 160p per day and for business gas 25p to 130p day.
The energy companies like a standing charge tariff because it gives them a degree of revenue predictability. They know no matter what they will be getting at least some money from you. This helps them pay for investment in the UK’s energy infrastructure.
What is a no standing charge tariff?
As the name suggests, a no standing charge tariff removes the daily fee charged by your supplier. In some cases, the charge will be set to zero on your bill (this may be referred to as a zero standing charge tariff).
This means that you will only be required to pay for the gas and electricity you use. If you were to consume no gas or electricity, you would have no charges for that period.
What are the pros of a zero standing charge tariff?
While most businesses in the UK operate year-round, and hence use energy year-round, not all do. Many seasonal businesses such as campsites, holiday resorts, ice cream parlours, etc. may only operate for part of the year could be left out of pocket if they are on a standing charge tariff.
If you own a seasonal business, you’d end up still paying energy bills even when you’re not using any energy! Choosing your business energy tariff usually comes down your circumstances and how your business operates.
What are the cons of a zero standing charge tariff?
Many business energy suppliers rely heavily on standing charge tariffs for cashflow predictability. As a result, suppliers will often increase your gas and electricity unit rate for no standing charge tariffs. So, whilst your save money when your business is not open, you could be spending more when it is.
Compare no standing charge tariffs with British Business Energy
When thinking of switching business energy, it’s vital to compare the full cost of any energy tariff. This is particularly important when comparing no standing charge tariffs.
With British Business Energy, you can compare a range of no standing charge and standard tariffs to make sure you’re finding the cheapest business energy deals possible.
All you have to do is simply fill in our quote form at the top of the page.
No Standing Charge Tariff FAQs
Where can I find my standing charges on my energy bill?
Your standing charge will normally be marked as units of daily usage on your energy bill. As your standing charges should remain the same throughout your usage, you can use this to calculate how much they will add to your energy bills over the year.
Which suppliers offer no standing charge tariffs?
Most energy suppliers no offer a no standing charge tariff option to their customers. This includes the traditional big six and many smaller, independent suppliers.
When you compare no standing charge tariffs, you will usually have a wide range of options to choose from.
Are domestic no standing charge tariffs available?
No standing charge tariffs are offered to both business and domestic customers. The pros and cons remain much the same as most suppliers will increase unit rates on no standing charge tariffs.