How Can My Business Lower Standing Charges?
For many UK businesses, standing charges are an unavoidable part of energy bills. Unlike unit rates, which fluctuate based on usage, standing charges are fixed daily costs applied regardless of how much energy you consume. Leading many businesses to look into ways in which these standing charges can be reduced.
In some scenarios they are unable to be reduced, but there are times in which they can be lowered. Reducing these costs, requires a more detailed understanding of how these charges are calculated and what factors influence them.
What makes up a standing charge?
Standing charges are often made up of several components, including:
While suppliers apply the standing charge, a large proportion of the cost is driven by network-related charges, meaning there are opportunities to reduce them — but not always in obvious ways.
TCR Banding
The
Targeted Charging Review (TCR) has changed how certain network costs are recovered, particularly for non-half-hourly (NHH) customers.
Under TCR, many charges are now fixed and linked to banding structures based on usage characteristics rather than actual consumption. Being placed in a higher band can significantly increase your standing charges. Various
use of system charges are based on which TCR band a meter is in, and these charges can often make up part of the standing charge.
While banding is determined by historical usage and meter type, there may be opportunities to review your position and ensure it accurately reflects your business profile. By contacting your
DNO, you can see when the next TCR band review is scheduled -- in situations where usage is below the levels associated with your TCR band, you may be able to request a review before then.
Validate your bills
As with all elements of energy billing,
errors can and do occur. Standing charges are no exception.
Businesses should ensure that charges match agreed contract terms, correct rates and structures are applied, and no duplicate or incorrect costs are included.
Without proper validation, these issues can go unnoticed. Particularly as standing charges are often seen as “fixed” and not questioned.
Take a strategic approach
Reducing standing charges is rarely about a single change. Instead, it involves a combination of:
For many businesses, these areas are complex and time-consuming to manage internally.
Take control of your energy costs
At SeeMore Energy, we help businesses go beyond headline rates and uncover hidden savings within their energy setup -- including standing charge optimisation.
From
kVA capacity reviews and TCR analysis to full bill validation, we ensure every element of your energy costs is working in your favour.
If you want to reduce unnecessary charges and ensure you’re not overpaying, get in touch today. Our expert team will identify opportunities and help you take full control of your energy spend.
