Business energy standing charges: what they are and what's typical

What a standing charge is

Your bill has two main building blocks: a price for each kilowatt hour you use (the unit rate) and a fixed daily amount (the standing charge) charged for every day the supply is live. It is the supplier's way of recovering costs that do not depend on how much you use. Exactly what goes into it varies by supplier and tariff, and network charges are increasingly recovered this way. Because it is per day, it does not change when you use less.

It is quoted in pence per day. A 58p standing charge is £0.58 for each day; over a year of 365 days that is £211.70.

Typical figures

Indicative averages for new fixed deals in October 2026, from Moneysupermarket Business (21 October 2026), a page with some internal inconsistencies:

Size	Electricity (p/day)	Gas (p/day)
Micro	58.0	44.9
Small	118.9	49.5
Medium	90.1	67.3
Large	173.0	61.8
Out-of-contract	254.0	338.0

Aquaswitch, another commercial source, said in August 2026 that standing charges are typically 40p to 100p a day on standard contracts and 200p to 300p a day on deemed contracts. So the figure moves a lot depending on whether you are on a negotiated deal or a default one. The big jump out of contract is one of the best reasons to avoid deemed and out-of-contract rates.

Worked examples

What the charge costs when you're closed

A pub shuts for 28 days for a refit. Standing charges on a micro-type deal of 58.0p/day electricity and 44.9p/day gas continue:

• Electricity: 28 × £0.58 = £16.24
• Gas: 28 × £0.449 = £12.57
• Total: £28.81, plus any unit charges for what you do use.

See do I pay standing charges when closed. The rule of thumb is yes, while the meter is live.

Low standing charge or low unit rate? (hypothetical tariffs)

Tariff A has 28.4p/kWh and 58p/day. Tariff B, invented for illustration, has 32.0p/kWh and 20p/day.

• Standing charge difference per year: 365 × (£0.58 − £0.20) = £138.70 more under A.
• Unit rate difference: 3.6p/kWh more under B.
• Break-even: £138.70 ÷ £0.036 = about 3,853 kWh.

Below roughly 3,853 kWh a year, B is cheaper; above that, A wins. At 3,000 kWh: A = £852.00 + £211.70 = £1,063.70; B = £960.00 + £73.00 = £1,033.00. At 15,000 kWh: A = £4,260.00 + £211.70 = £4,471.70; B = £4,800.00 + £73.00 = £4,873.00. So low-use sites like a seasonal kiosk or a small storage unit may do better with a lower daily charge, while busier sites prefer lower units.

Why standing charges differ

• Region. Network costs differ between the 14 distribution areas of Great Britain, so the same supplier can quote different daily charges for different postcodes; see why standing charges vary by region and TNUoS and DUoS.
• Meter type and size. Half-hourly and larger supplies often carry higher daily charges or separate capacity fees; see half-hourly meters and supply capacity.
• Contract type and supplier. A supplier may load more cost into either the unit or the daily charge.
• Customer risk. Credit position can affect pricing; see credit scores and energy prices.

Can you avoid them?

Some tariffs advertise a very low or zero standing charge, normally with a higher unit rate. These can suit occasional use. Check the whole annual cost and the contract terms; our page on no-standing-charge business tariffs explains who they suit. You can also cut standing charges by closing unused meter points properly; see closing a business energy account.

Why standing charges rose in 2026

From April 2026 the transmission network charges paid by business electricity users (TNUoS) went up sharply. TotalEnergies, a supplier, said in February 2026 that the 2026/27 rates were about 60% higher than the previous year's, and that it expected the related standing charge element to rise by a similar proportion. On a fixed, non-pass-through contract signed earlier, your supplier carries that change until renewal; on a pass-through contract it can appear on your bill straight away. Either way, expect renewal quotes to show a higher daily charge than your old deal.

Questions to ask about the standing charge in a quote

• Is the daily charge fixed for the whole term, or can it change with network costs?
• Is there a separate capacity (kVA) or metering charge on top?
• Does the charge apply per meter? A site with two meters pays two daily charges.
• If I close the site temporarily, does the charge continue, and can the supply be de-energised?

Two meters, two charges

A café has a single-rate meter and a separate meter for a flat upstairs used as storage. At 58p a day each, the two cost 2 × 365 × £0.58 = £423.40 a year before any energy is used. If the second meter records only 300 kWh a year, its standing charge (£211.70) is far more than its energy. Ask the supplier and network operator whether removing the meter is worthwhile, what it would cost, and whether you might need the supply again later, because reconnecting a removed meter can take time and money.

Where to find it on your bill

Your bill lists the charge as pence per day times days in the period. For a 30-day period, 58p a day gives £17.40. If the number is far above the contract rate, ask for a breakdown and compare it with your Principal Terms; see reading your business energy bill and disputing a high bill.

Standing charge and tax

Standing charges attract VAT at the same rate as the energy supplied, normally 20% for business use (see HMRC VAT Notice 701/19: fuel and power). The Climate Change Levy applies to energy used (0.801p/kWh from 1 April 2026), not to the standing charge. See VAT and Climate Change Levy.

Next steps

1. Find the p/day figure on your latest bill for each fuel.
2. Multiply by 365 to see the yearly fixed cost.
3. Compare quotes on annual total at your usage.
4. Use the cost calculator to test tariffs.

Biz Energy is independent and not a supplier or broker.