New Ofgem rules on standing charges: what they really mean for a one‑bed flat versus a family home

Sophie Bennett • December 10, 2025 16:46

On a Wednesday night in a one‑bed flat in Leeds, Sam scrolls through her energy bill and notices something that doesn’t budge, no matter how many blankets she piles on the sofa: the standing charge. Her actual electricity use is tiny, but the daily fee for simply being connected chews through the direct debit like clockwork.

Ten miles away, a family of five in a semi‑detached house runs two laptops, a tumble dryer and an eternally humming fridge‑freezer. Their bill landed the same week, and they saw the Ofgem headline about “changes to standing charges” pop up in the news app. Same rulebook, very different lives.

The regulator has now tweaked how these fixed fees work and how suppliers can recover them. The standing charge hasn’t vanished, but the balance between “what you pay just for having a meter” and “what you pay for each unit you actually use” is shifting. For a one‑bed flat and a family home, the impact feels almost opposite.

Below is what has really changed, who gains, who risks losing out, and what you can actually do about it instead of just glaring at the bill.

What Ofgem has actually changed

Ofgem hasn’t banned standing charges; it has changed the rules around them.

In recent price cap periods and rule updates, the regulator has:

Equalised prepayment and direct debit charges so prepay customers are no longer paying a premium just because of how they pay. The extra cost of running prepay meters is now spread more evenly across all customers.
Tightened what can sit inside the standing charge, limiting some of the extra add‑ons and shifting more attention onto whether costs are genuinely fixed (like network maintenance) or could live in the unit rate instead.
Pushed for clearer billing, forcing suppliers to separate and explain the standing charge on statements so it’s obvious how much is fixed and how much is usage‑based.
Opened the door to more tariff variety, signalling that suppliers can experiment as long as overall costs stay within the cap – including tariffs with lower standing charges but higher per‑unit prices, or vice versa.

Right now, that means two things in practice:

The headline standing charge in the price cap is still there and still noticeable, especially for electricity.
The way those costs fall across different types of households is under more scrutiny, because low‑use customers feel the pain far more sharply than heavy users.

The rules affect England, Scotland and Wales. Northern Ireland has a separate regulator and set of arrangements.

Standing charge vs unit rate: the bones of your bill

Every standard energy bill has two main moving parts:

Standing charge – a flat fee per day, in pence, for each fuel. You pay this even if you switch everything off and go on holiday.
Unit rate – a price per kilowatt hour (kWh) of energy actually used.

Standing charges cover things like:

Keeping you physically connected to the network.
Maintaining cables, pipes and meters.
Some social and environmental policy costs spread across all customers.

Unit rates pay for:

The gas or electricity itself.
Wholesale price swings.
Some of the supplier’s running costs.

When Ofgem adjusts the rules, it can nudge costs between these two levers. A higher standing charge with a lower unit rate is kinder to big users. A lower standing charge with a higher unit rate favours people who use very little.

The core unfairness many people feel is simple: if half your bill is a fixed fee, your ability to save money by cutting back is limited. That is far more obvious in a one‑bed flat than in a busy family home.

A one‑bed flat versus a family home: the new shape of the bill

To see how the rules bite, imagine two typical households on a price‑capped, standard variable tariff:

Sam – lives alone in a one‑bed flat, all‑electric, careful with heating and appliances.
The Khans – two adults, three kids in a three‑bed semi, gas heating, lots of laundry and cooking.

Numbers vary by region and tariff, so treat these as illustrative examples, not exact promises.

Home type	Annual use (rough guide)	How the standing charge feels
One‑bed flat, low use	1,500 kWh electricity, no gas	Standing charge can be 30–50% of the total bill, even after cuts to usage.
Family home, higher use	3,500 kWh electricity, 12,000 kWh gas	Standing charge may be under 15–20% of the bill; usage dominates.

Under Ofgem’s newer approach:

The relative weight of the standing charge is still heavy for low‑use households. Even if the daily fee drops a little or stops rising as fast, it looms large when you only use a modest number of units.
For families, the standing charge is spread across far more units, so even a chunky daily fee feels diluted. A small tweak to the unit rate often matters more to them than a small tweak to the standing charge.

Where the changes can be felt most sharply is among:

Single‑occupancy homes and flats that have already cut usage.
Prepayment customers who used to pay more and now see some relief – but who still have to shoulder a fixed daily hit, even when they wildly restrict usage.
Second homes or rarely used properties, where almost the entire bill can be standing charges.

The awkward truth is that the same rule designed to make sure everyone pays towards shared infrastructure lands very differently depending on how many people live behind a front door.

Why this feels unfair if you live alone

In a one‑bed flat, the standing charge often feels like council tax: unavoidable, regardless of how careful you are. You keep the thermostat low, turn off lights, run the washing machine overnight once a week – and then see that most of the bill is just for being plugged in.

From Ofgem’s side, the logic runs like this:

The cost of keeping the network there at all does not change much whether you use 1 kWh a day or 20.
Spreading those fixed costs into the unit rate alone would make each kWh more expensive for higher‑use, sometimes lower‑income households (for example, big families in smaller homes).
A standing charge is a blunt but simple way to make sure those infrastructure costs are shared.

The counter‑argument from charities and many campaigners is just as clear:

High standing charges are regressive – they bite the hardest for people who use the least and have the fewest options to cut back.
They hit single people, many pensioners, people in flats and those in temporary accommodation disproportionately.
They also penalise people trying to be efficient: you invest in insulation or better appliances, yet a big chunk of the bill doesn’t move.

Ofgem’s recent changes are a recognition of that tension. The regulator has not ripped out the standing charge, but it has capped some of what suppliers can hide in it and is signalling that the balance between fixed and variable may keep evolving.

What “fairer” looks like in real life

For a one‑bed flat, a fairer system would usually mean:

Lower standing charge, even if the unit rate is slightly higher.
A clearer link between “I used less” and “I paid less”.

For a busy family home, fairness can look different:

A reasonable standing charge that recognises heavy reliance on the network.
Stable, predictable unit rates that don’t punish them disproportionately for having kids, carers, or people at home all day.

Under Ofgem’s adjusted rulebook, you might see:

More tariffs where the standing charge varies slightly and the unit rate does more of the work, especially for electricity.
Suppliers offering niche tariffs (time‑of‑use, green or EV‑focused deals) that quietly lower the standing charge but charge more at certain times of day.

Let’s be honest: nobody spends a Sunday afternoon happily comparing billing structures. But if you live alone with low usage, the shape of the tariff now matters almost as much as the headline price.

How to navigate this if you’re in a one‑bed flat

If your usage is low, your goal is simple: minimise the fixed bit, even if you pay a touch more per unit.

Practical steps:

Compare standing charges first, then unit rates. On comparison sites, sort tariffs by standing charge for your region and fuel type before looking at anything else.
Check for tariffs with lower standing charges. Some suppliers quietly offer options with a leaner daily fee and higher unit rate. For a low‑use flat, that can work in your favour.
Electric‑only? Look at whether you need two fuels. If the gas meter realistically won’t be used, talk to your supplier before disconnecting – there may be standing charge implications either way, so get written confirmation.
Prepayment customers: make sure you are actually on a tariff that reflects the newer, fairer rules. If you have a smart prepay meter, ask whether you could switch to credit mode and pay by direct debit, which can open more tariff choices.
Check support schemes. Warm Home Discount, cost‑of‑living payments and local council support can all blunt the impact of fixed charges if you’re on a low income.

The key idea: if you use very little, do not automatically chase the lowest unit rate. The cheapest bill for you might be the tariff with the lowest standing charge instead.

How to play it if you’re in a family home

In a busy household, the standing charge still matters, but it is not where most of your money goes. Your main lever is usage.

For a typical family:

Unit rate shifts will overshadow small changes in standing charges. A 1–2p change per kWh over thousands of kWh a year adds up quickly.
Smart, time‑of‑use tariffs can help if you can move some usage (washing, EV charging, dishwashers) to cheaper hours.
Insulation and heating efficiency remain the biggest long‑term saves. A well‑sealed home can cut thousands of kWh of gas use, making unit rates much less scary.
Smart meters give you half‑hourly data. That matters on modern tariffs where peak and off‑peak prices differ, and it gives you concrete numbers when kids swear they “definitely” didn’t leave the TV on all night.

You still should not ignore the standing charge – especially for a second property or if you’re often away – but your savings are far more likely to come from reducing kWh than from shaving a few pence off the daily fee.

Key differences at a glance

Point	One‑bed flat, low use	Family home, higher use
Standing charge impact	Can be a large slice of bill, even after cutting usage.	Smaller slice; spread across many more kWh.
Best tariff shape	Lower standing charge, OK with slightly higher unit rate.	Reasonable standing charge, keen eye on unit rates.
Biggest win	Finding a low‑standing‑charge tariff and using support schemes.	Cutting overall kWh and using time‑of‑use or smart tariffs well.

What to watch for next

The recent Ofgem changes are not the end of the story. The regulator is openly consulting on:

Whether more policy and social costs should move into unit rates, reducing the standing charge further.
How to protect very low‑use and vulnerable customers, especially people in temporary accommodation, park homes or supported housing.
How local networks should recover their costs at a time when solar panels, batteries and heat pumps are changing how people use the grid.

For now, neither a one‑bed flat nor a family home can escape standing charges entirely. But understanding how they work – and choosing a tariff that fits your pattern of life rather than someone else’s – is the bit you can control.

FAQ:

Can I get a tariff with no standing charge at all? A handful of suppliers occasionally offer “zero standing charge” tariffs, usually with noticeably higher unit rates. They can be good for extremely low or intermittent use (holiday lets, occasionally used flats), but they’re rare and terms can change quickly.

Have Ofgem’s new rules reduced everyone’s standing charge? Not automatically. Ofgem has changed what can be recovered through the standing charge and equalised some costs across payment types, but regional differences and supplier choices mean your own daily fee may have moved only slightly.

If I use almost no energy, is it worth switching? Often, yes. For very low‑use households, even a modest reduction in standing charge can outweigh a small increase in the unit rate. Use realistic annual usage figures when you compare.

Do smart meters change my standing charge? Not directly. The standing charge is set at tariff level, not by meter type. But smart meters unlock more tariff options (like time‑of‑use deals) that can help you cut the usage part of the bill.

Is Ofgem likely to scrap standing charges entirely? That is unlikely in the short term. The regulator is more focused on rebalancing which costs are fixed versus variable, and on protecting vulnerable customers, than on removing standing charges altogether.