HomeTechnologyA Standing Charge: How...

A Standing Charge: How it Works On a Business Energy Contract

A business energy contract has a standing charge, but you can also decide to have a contract with a zero standing charge. Currently, a few energy tariffs offer a no-standing charge option. It’s worth noting that there is zero standing charge on a business gas tariff. Before you switch energy suppliers, you need to compare business energy to check whether the available energy tariff has a standing charge. This article discusses how a standing charge works on a business energy contract. 

What is A standing Charge?

A standing charge is simply an amount you need to pay the energy supplier to supply your business with electricity and gas. This charge covers the expenses related to keeping your business premises connected to the energy network.

A standing charge can apply in various ways, but this depends on the type of energy contract you have. And, if your agreement, the energy supplier can apply it regardless of how much your business uses energy, meaning it can still be valid even if you don’t use energy.

When choosing your business energy plan, you must consider your unique business situation. This means you should determine if your business will be open at specific times. Also, assess if your business may use much energy. These factors can affect your energy costs significantly.

That said, you can opt for a fixed contract that gives you the chance to lock in your electricity and gas prices for a while. This can remove the risks of spiraling costs. With this type of energy contract, you may be paying a little more per unit of energy your business utilizes, but you can know how much you have to pay monthly. 

When wholesale market price fluctuations occur, your energy supplier cannot increase it. But you can miss out on lower energy prices when the energy prices drop in the market.

A fixed contract ensures that you are secure regarding an electricity tariff. Regardless, you still have to look at the costs, especially when you compare a fixed-term gas contract. It’s worth mentioning that a zero-standing charge energy contract can have a higher rate, so you must calculate what the difference may be. Sometimes, choosing a zero-standing charge energy tariff may not be a good idea.

Besides, the energy supplier may require you to pay an exit fee if you want to switch to another energy supplier when you are on a fixed energy contract. The energy supplier can include a termination fee in your energy contract, so ensure that you are pleased with it before signing it. 

Choosing a flexible or variable energy contract can be a good solution if your business energy usage is high. A variable energy contract means you don’t lock in your energy price for long. In most cases, it can last about 30 days, making it easier to switch energy suppliers or change to another energy tariff.   

It can be hard to spot your standing charge on variable energy contracts because it’s usually under a pass-through clause. Therefore, your energy supplier can decide to raise the unit rate once their costs increase. This allows them to improve or maintain their profit margins.

Standing charges for domestic customers and business energy users

Business customers can pay different standing charges compared to what domestic customers pay. This happens because it is designed to help your energy supplier maintain the energy supply to your business premises, such as infrastructure. Therefore, it can vary depending on your energy usage. Also, your business can even be eligible for extra charges that the government imposes associated with carbon emissions

You should also remember that the it can depend on the type of energy contract your business has, the amount of energy the business uses, and the size of the business. 

It’s also worth mentioning that you can switch to a zero-standing charge energy tariff for the gas supply. Therefore, you can be paying for the gas your business uses. As a result, your unit energy rates can be higher. Whether or not you can save money can depend on how, where, and when you utilize your energy. 

Remember that there are advantages and disadvantages of zero-standing charge tariffs. One of the benefits is that you can only be paid on the days you are using your business premises. In other words, you cannot pay a standing charge if you don’t use energy. Another good thing about a zero-standing charge tariff is that you can save on energy bills if your energy consumption is relatively low.

One of the downsides of a zero-standing charge tariff is that your business can be subject to higher unit energy rates. As a result, everything your business uses can cost you more money. But you can get a reasonable energy rate if your business uses energy to a specific threshold. 

And, if your business utilizes much energy, there is a chance that you may pay a lot more money. This is because there can be higher unit energy rates on a zero-standing charge tariff.

Standing charges are no longer a requirement since 2016, so there are now several energy suppliers on the market that provide a wide range of zero-standing charge tariffs on electricity and gas. But if you are unsure whether your business can benefit from zero-standing charge tariffs, then it makes sense to contact energy experts at the utility broker. They can take the time to compare energy tariffs and help you switch business energy suppliers. They can assess your business’s energy needs to ensure you get the right energy tariff. They can also answer any of your questions and address all your energy concerns.

Check out: 7 Types of Renewable Energy Sources: Future of Energy

Most Popular

More from Author

Future Application of AI and ML in the Healthcare Sector

Healthcare is one of the sectors which is constantly developing thanks...

10 Chatbots That Will Improve Your Customer Service

Everybody has social anxiety sometimes. Whether you live with a large...

The Tech That is Driving Transparency in the Workplace 

As technology continues to evolve and become more prevalent in our...

iOS App Development Trends That will be Popular in 2023

According to a survey, iOS app development is the most revenue-generating...

Read Now

What Should You Know About Metal 3D Printing?

The introduction of technology in the manufacturing industry has been instrumental in the overall quality of output. Many companies have embraced new techniques to improve their production processes to meet customer demands. Metal 3D printing is an industrial manufacturing technique that permits parts fabrication by adding multiple...

Taking a Closer Look at Residential Intercom Systems

Whether you’re a renter or a homeowner, one of your top concerns is likely security. That’s why residential intercom systems are such an important consideration. Intercom systems give you the peace of mind of knowing that your home is secure, and they offer additional convenience features, like...

Exploring the Boundaries of Human Creativity with AI Technology

The Colorado State Fair's annual art competition doesn't normally make national headlines. But when this year's first prize winner in the digital art category turned out to be a piece created with the assistance of AI technology, it sparked outrage, and the story went viral. Lost in the...

5 Ways Technology Has Transformed Learning for School Students

Technology has transformed how school students learn in countless ways, and it continues to evolve and improve with each passing year. The growing importance of technology in education cannot be overstated. Technology has transformed how school students learn and find new educational possibilities, from online classes and remote learning...

The Path to Better Health is Paved With Tech Innovations 

We live in an era where technology is fast becoming embedded in our society, impacting nearly every aspect of your lives – and healthcare makes no exception. Although the healthcare industry has been lagging behind in implementing new technologies, especially in the public sector, the rate of...

What Role Does AI Play In Healthcare Software?

When the role of AI in healthcare comes to mind, you are bound to think of its numerous applications. With the power of AI, thousands of operations in the healthcare sector can be performed within seconds. Whether powering surgical robots, undertaking medical research, or discerning links between...

How You Can Improve The Quality Of A PCB At Home?

In this article, we will cover methods for improving the quality of PCBs at home. We are all aware that printed circuit boards (PCBs) are an essential component of electronics and that the quality of your PCB can substantially impact the quality of your project as a...

4 Database Scaling Solutions to Consider

You have released an application with an intuitive and user-friendly user interface. But if your application faces a load issue, your end users will become frustrated. Most likely, the issue lies within the database and not the application. 38% of database professionals cited database downtime as the...

Secure Hosting Service Without Compromise

Learn about security features and check how to choose secure hosting service for your website. In this article, I will show you how to turn your Server into an impregnable fortress. In order to do it, you need backups, file and data security, safe email, DNS, SSL, web...

Tips to Avoid Risks Before You Implement Industrial IoT Solutions

If you are curious about the deployment of Industrial IoT Solutions, you are aware that this process is expanding globally at a rapid rate. According to McKinsey Digital, 127 gadgets will connect to the Internet for the first time every second in 2021, and the value of...

Comparison Between RPA and Test Automation

RPA is short form of "Robotic Process Automation," which relates to technology that can move with tools, IT infrastructures, and business processes using AI and Machine Learning to be instructed and change repetitive activities. RPA is a potential solution for data-intensive tasks. It will eliminate the recurring human...

7 Easy Steps to Find Bugs on Your Mobile App

According to surveys, there are about 2 million mobile apps in the Google Play store and nearly 3 million in the Apple Store. With 5.1 billion mobile phone users, almost 90% of mobile usage is spent on various mobile apps. Therefore, businesses must guarantee that app issues...