Standing charge or zero standing charge?
In Britain there are currently around 20 home energy suppliers, including the ‘Big-6’. The prices they charge are not set by the Regulator (Ofgem) but rather competition between them for customers restrains the prices they can charge.
Despite this, last year Ofgem took the decision that all energy suppliers have to include a standing charge as part of the bill, although it can be zero. Many may ask themselves why Ofgem made the decision to introduce a mandatory standing charge. The theory is very simple, every energy company faces fixed costs in supplying its customers (the cost of using the pipes and wires, the rental fee to the company that owns the meters in homes) and variable costs (the cost of the energy) and it is up to the company how are they going to cover those costs. In the past this could be done by charging more for the first set of units a customer used and less thereafter. This was called tiered charging. Ofgem decided that tiered pricing was too complex and should be removed. Instead they have decided that energy companies must display their fixed costs as a separate charge (the ‘standing charge’) making pricing slightly simpler. So the energy companies put fixed costs for things such as meter readings, meter maintenance and the cost of keeping customers connected to the network into standing charge, then combined their variable costs such as purchasing the energy on the wholesale market, the cost of running the business, the Government schemes and profit margins into their unit price.
Our customers already know that Ebico has simple and fair pricing with one unit price, zero standing charges, no tie-ins and no exits fees, no matter how they pay. For those who didn’t know, since Ofgem’s new regulations, Ebico is also currently the only energy company serving customers throughout Britain that has both gas and electricity tariffs with zero standing charge available to new customers. We simply put all fixed and variable costs into one price â€â€œ our unit price. We believe that this is a simple way of charging our customers.
Price wise, for customers using relatively small quantities of energy, the standing charge is often burdensome as it makes up a large proportion of their bill. In addition, customers paying a standing charge who try to reduce the amount of energy they use, whether for cost or environmental reasons, are insufficiently rewarded as the standing charge is added to their bill every month irrespective of how well they’ve managed to economise. By contrast, customers using our EquiGas & EquiPower tariffs will see their bills reduce in almost exactly (the government takes a share through the 5% VAT rate) in proportion to their energy use reduction.
But it’s not all about price. At Ebico we try to make the difference in the market all the way, so we use what surpluses we make to fund projects that work with local communities to fight fuel poverty, helping those, sometimes in the most desperate situations, to manage their gas and electricity costs.
17 Responses to Standing charge or zero standing charge?
Terence Davies says:
10/02/2014 at 1:06 pm
Ebico is my choice for Gas and electricity , No standing charge . I will be highly unlikely to change supplier 🙂
Rob Townsend says:
14/02/2014 at 11:18 am
I received an email from Scottish Power today, informing me my deal was coming to an end. So, I shopped around and discovered that the â€œno standing chargeâ€Â deals were disappearingâ€Â¦until I came across Ebico’s website via an online search. Perfect! This is how pricing should be. Simple, fair and cost-effective. What’s more, I like the idea of dealing with a non-profit organisation. Naturally, I signed up and look forward to dealing with Ebico. I truly believe that the other energy companies will see a lot people moving to Ebico in search of a no standing charge deal.
Sarah ruane says:
04/03/2014 at 3:58 pm
I have been with ebico since early 2007, and have always found them to be the best company around. I have never had any complaints with them, and if anything goes wrong, they are quick to rectify the situation.pricing is fair..im not going to change companies any time soon 🙂
Mike Dickeson says:
27/03/2014 at 8:29 pm
Zero standing charge is the fairest system ever for low fuel users and the main reason I have been a Ebico customer for many years including when I moved to a new address.
Okay I pay a bit more for my basic units but as a low user of electric I know that I gain from this option because I have created spreadsheets and input the other suppliers tariffs.
So if your a lower user by being very frugal with your fuel usage or perhaps out of the home a lot for what ever reasons, Ebico may well be your preferred choice.
04/10/2014 at 11:16 pm
I too did a spreadsheet, with all other tariffs, and after careful consideration chose ebico. You will not get much more frugal than me in terms of gas useage, with the daily standing charge being more than the actual gas I use, however see my comment 4th October 11.10pm!!
PRUDENCE ELLIS says:
06/11/2014 at 12:06 pm
Graham, when you did your spreadsheet did you factor in ebico prices,(higher)than BG, AND standing charges and get a result that was clear to you? As I am unable to do a spreadsheet I would appreciate your help. REGARDS PRU
oliver wells says:
13/07/2014 at 10:15 pm
do you have no standing charge deals for both gas and electricity. am with british gas at present, and am low user and no standing charge would likely suit better. thank you
oliver wells says:
13/07/2014 at 10:16 pm
do you have no standing charge deals for both gas and electricity. have prepay meter for both with british gas at moment.
21/07/2014 at 8:15 am
Yes, Oliver. At Ebico both EquiGas and EquiPower have Ã‚Â£0 standing charges
23/07/2014 at 1:53 pm
Do you only do domestic as we are only a small business and our overheads are crippling us especially the electric and gas. Thanks Christine
24/07/2014 at 8:06 am
Unfortunately, yes, we can supply only domestic properties.
23/07/2014 at 3:10 pm
I live in a rented property, with both gas and electricity, though I do not use the gas at all. Please advise.
24/07/2014 at 8:05 am
If you wish, you can switch to EquiGas and/or EquiPower tariffs. They are both Ã‚Â£0 standing charge tariffs so you pay only what you use. You can get a quote on our website and compare them to your current supplier’s rates.
Michael Jones says:
08/08/2014 at 1:07 pm
I have an Economy 7 meter. Can I join Ebico’s single rate system?
06/10/2014 at 8:24 am
Yes, you can, however, your meter will have to be exchanged. You would firstly have to apply to Ebico, via our online application form, on Economy 7 meter. Once the switch is completed you can request your meter to be exchanged.
04/10/2014 at 11:10 pm
So I signed up for equigas as an ex-British Gas customer on the understanding that ebico was ‘genuinely’ zero standing charge, so imagine my surprise to find my daily standing charge has now increased from 26p per day with BG to 27.4p per day with Ebico!!! Don’t know if my card was not programmed correctly or if this is just another one of those bulls*** arguments that taking everything into consideration you are ‘effectively’ paying zero standing charge?? Because at this moment the way I see it, I am ‘effectively’ now worse off than I was with British Gas. I am seriously not impressed!! Before I switched, I rang ebico customer service and SPECIFICALLY asked, so the zero standing charge is really zero, as in my meter will say zeroâ€Â¦â€Â¦â€Â¦â€Â¦â€Â¦YES they saidâ€Â¦. Maybe OFGEM would be interested to hear about your false advertising practices?
06/10/2014 at 8:27 am
Hi Graham, Ebico does have ZERO standing charge. It seems that there may be a problem with your card. If you call our supply partner’s prepayment team on 0800 980 0414 they should be able to sort that out for you.