Local MSP Welcomes Ofgem U-Turn on Standing Charges

Ariane Burgess, Scottish Green MSP for the Highlands & Islands, has today welcomed Ofgem’s decision to consult on introducing zero standing charge tariffs under the price cap, a significant shift in policy that she has long advocated for.

Earlier this year, Ms. Burgess wrote to Ofgem, urging them to think again on standing charges, which disproportionately impact rural households and those most vulnerable to fuel poverty. 

Ms. Burgess commented: 

“Much more must be done to help rural households who face the highest rates of fuel poverty.

“In much of the Highlands & Islands, there is no mains gas supply, so even direct debit customers are unable to access the cheapest tariffs on offer.

“Standing charges are a disincentive to everyone working hard to reduce their usage through energy efficiency.  

“The standing charges issue is fundamentally about fairness: there is no reason why energy bills for millions of poorer, low-income households should be proportionately more expensive than those of many larger and wealthier households.

“The government and Ofgem must work together to provide support for vulnerable customers who have high energy needs while enabling those who use less energy to avoid the moral hazard of an effective poll tax on energy use. 

“Standing charges lessen the impact of energy efficiency measures because the reduction in energy use is not fully reflected in lower energy bills. 

“We also need to think about what more can be done for those who simply cannot afford to pay their energy bills even as prices fall.

“Ofgem and the UK Government must seize the opportunity to reset the energy market so that it works for people and planet, not private profit.” 

Ofgem’s announcement today includes a consultation on introducing zero standing charge tariffs alongside existing tariffs, offering consumers the ability to choose what is right for them.

Some suppliers already offer low- or no-standing charge tariffs, but they are not universal.

More choice is needed for all consumers, including those in debt. 

Additionally, Ofgem has set out a comprehensive debt strategy aimed at tackling the growing impacts of rising debt in the energy system.

This includes new supplier standards to make it easier for struggling customers to get the support they need. 

Ms. Burgess concluded:

“These proposed changes are a step in the right direction.

“They aim to reset the debt that has built up in the energy system following the energy crisis and reform the way debt is managed in the long term.

“This will help limit the risk of unsustainable levels of debt continuing to build up in the future and ensure that customers can expect consistent, compassionate, and tailored support.”