Gas standing charges are being scrapped: what it means for your bill

What has been announced

At the Budget on 28 October 2026, the government said it would end standing charges on household gas bills. It has asked Ofgem, the energy regulator, to remove them in 2027 or as soon as possible after. The government says around 23 million homes will stop paying a gas standing charge.

A gas standing charge is a fixed daily amount you pay whether or not you use any gas. The government puts it at £108 a year for the typical household. That matches the price cap: from 1 October 2026 to 31 December 2026, the GB average Direct Debit gas standing charge is 29.68p a day, or £108.33 a year.

It varies a little by region, from 29.16p a day in Southern England to 30.20p in London. See every region’s standing charges.

Where the costs will go

Standing charges pay for costs that do not depend on how much gas a home uses, including the network that delivers it. Removing the charge does not remove those costs. The government says they will move to the unit rate, the price you pay for each kilowatt-hour (kWh) of gas, so what you pay will depend more on how much gas you use.

Ofgem has not yet published how this will work or how much unit rates would rise. Today the GB average gas unit rate is 7.97p per kWh. Until Ofgem sets out the detail, nobody can say exactly what an individual household will pay. Gas prices per kWh by region.

Who is likely to pay less, and who may pay more

The government estimates that about 60% of households with a gas account would save, by an average of around £45 a year. That figure comes from Treasury analysis using Ofgem’s average gas rates for October to December 2026.

Because a fixed charge is replaced by a higher price per unit, homes that use little gas gain most. The government says a household on median gas use, and low users who heat with gas, are likely to see lower bills. Homes that use a lot of gas could pay more, because more of the moved costs would reach them through the unit rate. The government says it will set out targeted support for some vulnerable households with high gas use they cannot avoid.

For a sense of scale, Ofgem’s typical gas use is 6,000 kWh a year for a low user, 9,500 kWh for a medium user and 14,000 kWh for a high user. At today’s GB average rates, the standing charge is about 18% of a low user’s gas bill, 13% of a medium user’s and 9% of a high user’s.

Electricity standing charges are not changing

The announcement covers gas only. Electricity bills keep their daily standing charge: the GB average under the current cap is 54.83p a day, about £200.13 a year. Homes without a gas supply, including many that heat with electricity, are not affected by this measure.

When it happens and what to do now

You do not need to do anything. Gas standing charges keep applying until Ofgem makes the change, which the government expects in 2027 or soon after. Ofgem resets the price cap every three months and will publish the details.

In the meantime, check the standing charge and unit rate on your gas bill. If you are choosing a tariff now, compare the two together at your own usage rather than looking at one number. Our energy bill calculator does the sum for you.

The government has not yet said how the change will apply to fixed-term tariffs that are already running, or set out the support for high users. We will update this guide when Ofgem and the government publish more detail.

Frequently asked questions