Ofgem ‘Not Fit for Purpose’ on Standing Charges, Says Stirling MP
Alyn Smith has challenged the UK Government to act urgently to address sky-high standing charges across the UK, as fresh figures show the scale of eye-watering increases facing households across Scotland. The Office for Gas and Electricity Markets – commonly referred to as ‘Ofgem’, has responsibility over this policy area.
In a question to UK Secretary of State for Energy Security and Net Zero Claire Coutinho MP on Tuesday, Mr Smith called into question Ofgem’s performance in tackling high energy bills.
Financial website ‘This Is Money’ reports in the summer of 2021, the typical electricity standing charge across the UK was 25p a day, and 27p for gas. Under new proposed increases this year from 1 April, electricity standing charges will be 60.1p a day and the average gas standing charge will be 31.43p a day. This represents a 219% and 16.4% increase respectively since the summer of 2021.
In Scotland, average electricity standing charges from October 2021 – March 2022 were £90.84; between April 2024 and June 2024, average standing charges are projected to be £216.23, a whopping increase of 138%.
For gas in Scotland, gas standing charges from October 2021 – March 2022 were £90.81; between April 2024 and June 2024, average standing charges are projected to be £109.94, an increase of 21.1%.
Stirling MP Alyn Smith said:
‘People are struggling with their energy bills because the UK energy market is broken. It already wasn’t fit for purpose, remaining weak, fragmented and hugely exposed when Russia launched a fresh invasion of Ukraine in 2022. Now wholesale energy costs are coming down, consumers are being hit with sky-high standing charges. Customers across Scotland will be left paying for market failures, without even the option of reducing their consumption to lessen their bills.
‘This is a direct consequence of Westminster control over Scotland’s energy resources and policy. How can it be just that people are freezing in their homes, whilst Scotland pays some of the highest transmission charges in Europe? The UK Government must urgently tackle this completely broken market, or hand-over energy policy to the Scottish Government and get out of the way.’
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The exchange can be viewed here
