This is a fixed daily charge that keeps your business on the grid.
It’s one of the main ways suppliers charge you for your energy, along with the cost of the amount you consume.
Your standing charge stays the same no matter how much you use.
Think of it like line rental on your landline phone: even if you don’t make any calls, you still pay to keep your phone line active.
These are the components that make up the overall charge:
Maintaining the energy network - all connected homes and businesses pay towards upkeep of the network. This keeps things like cables and pylons working all over the country
Balancing services - this is a pot of money that National Grid uses to ensure it doesn’t have either too little or too much energy available to meet national demand
Transporting your energy across the network - this splits into 2 categories:
Transmission charges - the cost of transporting the energy you need from the generator to your local distributor
Distribution charges - the cost of transporting the energy from your distributor to you
Giving to national initiatives - energy consumers pay towards government action in the energy market. This includes:
running the Warm Home Discount
working with energy suppliers to install free smart meters
helping people when their energy supplier fails
These costs vary according to your meter type and where you live. For example, customers who live further away from power generators pay more in transmission charges.