Commenting on Ofgem’s low standing charge consultation, Energy UK’s chief executive Dhara Vyas said:
“Standing charges cover essential costs that need to be recovered one way or the other, as these are incurred by suppliers irrespective of the amount of energy customers use – including paying for the infrastructure necessary to deliver energy safely to our homes through network charges.
“So a customer signing up to a tariff with lower standing charges will inevitably be paying a higher unit rate – and hence the potential savings on offer could be negligible. It’s also worth remembering that vulnerable customers can be high energy users by necessity.
“We know households have been facing high energy costs for too long now and that recovering all the different costs on the energy bill in a way that is fair to all customers is a difficult balance – which is exactly what Ofgem’s cost allocation review is examining.
“It’s hard to see how pre-empting this with a measure that Ofgem admits will only be temporary and merely move costs around on the bill – so delivering a limited benefit to customers – warrants the potential cost and disruption. It would be better to direct efforts at a proper examination of costs, as well as tackling the record customer debt level. It’s also crucial that the Government continues to make progress on introducing targeted bill support for people who need it the most and takes action to bring down bills for all customers.”
ENDS