Burnham asks ministers to plan removal of gas standing charges

Prime Minister Andy Burnham has asked ministers to develop a plan to remove standing charges from gas bills. He made the request on Wednesday 21 October 2026 during Prime Minister's Questions, the weekly session in the House of Commons when MPs put questions to the PM.

Standing charges are fixed daily fees. They cover the costs of connecting a home to an energy supply, they vary by region, and they must be paid even when no energy is used. Burnham asked Chancellor John Healey and Energy Secretary Miatta Fahnbulleh to look at whether standing charges can be removed from gas bills, and to report back to the House of Commons at the earliest opportunity.

During the same session, Burnham described the government's decision to give the green light to the Jackdaw gas field in the North Sea as a "pragmatic decision".

The research firm Nesta has suggested moving gas standing charges onto the unit rate, the price paid for each unit of energy used, so that people pay for the energy they use. Moving the charges in this way would probably benefit customers who use little gas, while heavy gas users could end up paying more. Nesta's proposal and its effects are reported by the BBC.

Energy UK, which represents energy companies, said whether the proposed changes would reduce bills depends on how or where the standing charges are reallocated on the bill. An influential research foundation argued that removing the gas standing charge would be progressive, helping low-income households and cutting a typical annual bill by £27. Citizens Advice warned about the potential consequences of standing charge reform for vulnerable customers, including low-income households with high energy usage.

Standing charges also pay for transporting energy to homes, maintaining infrastructure and funding schemes that support low-income households. Average standing charges across the UK are 54.8p per day for electricity and 29.7p per day for gas.

The regulator Ofgem has run a series of consultations on standing charges for nearly two years and received a large public response. It is currently running a pilot scheme on low standing charge tariffs, and has not yet drawn firm conclusions from it.

Burnham's request covers gas only. Asked why electricity standing charges would not also be scrapped, the PM's official spokesman said VAT, the value added tax, had already been cut on electricity bills. Burnham said investing in renewables would bring household bills down substantially by breaking the link between gas and electricity prices in this parliament. UK electricity prices are mainly set by gas prices, a factor often cited for them being higher than in many other countries.

The timing follows a forecast that energy prices would rise by 16% to a four-year high in January. The chancellor faces pressure to offer targeted energy support in his Budget. The Financial Times reported that Burnham set out plans to scrap fixed daily fees from household gas bills as part of efforts to cut energy costs that winter.