What Is a Standing Charge on Business Energy?

Every business energy bill has two parts: the unit rate you pay per kWh, and the standing charge you pay per day. This guide explains what the standing charge is, why it exists, and how to tell if yours is too high.

What is a standing charge?

The business energy standing charge is a fixed daily amount, shown in pence per day, that covers the cost of having your premises connected to the gas and electricity network. It pays for the wires, pipes and meters, plus the admin of supplying you — regardless of how much energy you actually use.

Why do businesses pay a standing charge?

The standing charge bundles up the fixed costs of supply:

• Maintaining the local distribution network (the cables and pipes to your building).
• Meter operation and meter reading.
• Government and network policy costs.
• Keeping your account live with the supplier.

Because these costs exist whether you use 1 kWh or 10,000, suppliers recover them through a daily charge rather than the unit rate.

How much is the standing charge in 2026?

It varies by region, meter type and supplier, but as a 2026 guide:

• Business electricity: roughly 35–65p per day
• Business gas: roughly 25–45p per day

Larger sites and half-hourly metered premises can pay more, because their connection and metering costs are higher. Standing charges also differ by DNO region.

Standing charge vs unit rate — which matters more?

It depends on how much you use. A low unit rate with a high standing charge can cost a small, low-usage business more than a slightly higher unit rate with a low standing charge. Always compare on the total annual cost, not one number in isolation.

Can I avoid the standing charge?

Some suppliers offer no-standing-charge tariffs, but they charge a higher unit rate to compensate. They only work out cheaper for very low-usage sites — seasonal businesses, holiday lets or unmanned units using under about 5 kWh a day. For most businesses, a normal tariff is cheaper overall.

How to check and lower your standing charge

Your standing charge is printed on every bill in pence per day, alongside the unit rate. To sense-check whether yours is reasonable:

• Compare it against the 2026 ranges above (35–65p/day electricity, 25–45p/day gas).
• If it is far higher, you may be on a deemed or out-of-contract rate — switching usually fixes it.
• Remember a low standing charge with a high unit rate can still cost more overall — always compare total annual cost.

You cannot remove the standing charge on a standard tariff, but you can make sure you are not overpaying. A whole-of-market comparison checks the standing charge and unit rate together, against your real usage, so you see the genuine cheapest option. For very low-usage sites, ask specifically about no-standing-charge tariffs.

Do I pay a standing charge on both gas and electricity?

Yes — if you have both supplies, each has its own separate standing charge, because each has its own meter and network connection. A business with gas and electricity will see two daily standing charges, one on each bill (or two lines on a dual-fuel bill).

This matters when you compare quotes: a supplier might offer a low electricity standing charge but a high gas one, or vice versa. Always add up the full annual standing charges across both fuels alongside the unit rates. A business energy comparison does this automatically, so you see the true combined cost rather than four numbers in isolation.

Frequently asked questions