LONDON, Oct 28 — British finance minister John Healey announced plans to assist households with their gas bills by eliminating standing charges, which are fixed daily fees associated with gas supply connections. This initiative is part of Healey’s first budget, which will be fully detailed later this week.
Healey emphasized that the current gas standing charges are “unfair and outdated,” stating, “I am scrapping them to give millions of households a bit of breathing space.” The Treasury indicated that Healey will ask regulators to remove these charges, which average £108 ($143.78) a year for a typical household, in 2027 or as soon as feasible thereafter.
Under the proposed changes, costs will be redistributed to the price of gas consumed, potentially saving around 60% of households approximately £45 on their annual bills, according to the Treasury’s statement.
In his remarks, Healey asserted that his budget represents a departure from an energy policy that has burdened British billpayers with excessive costs for years. “We let extra costs on bills pile high and left households even more exposed to global shocks,” he said.
This announcement follows the government’s recent reduction of value-added tax on electricity bills, which had surged due to geopolitical events, including the war in Ukraine and the ongoing conflict in Iran.
Even with these measures, the regulated domestic price cap in Britain has already increased by 4% in October. Some forecasts predict a further rise of about 20%, potentially raising average household energy bills over £2,000 per year by January 2024, which includes electricity costs.
Currently, households also face a standing charge on electricity bills, costing around £200 annually under the current price cap.
For the latest updates, households and stakeholders will be looking for more details when Healey’s full budget is released in the coming days.
