Martin Lewis has welcomed the government's plan to scrap gas standing charges, a change announced today (October 28) that will affect around 23 million homes. The MoneySavingExpert founder said he was "pleased" with the move, which will see the fixed daily fee removed from next year.
Gas standing charges to be removed
The standing charge is a fixed daily fee added to gas bills regardless of how much energy a customer uses, costing around £108 per year for a typical household. The Treasury said Chancellor John Healey will ask regulator Ofgem to remove the charges "in 2027 or as soon as possible after".
Mr Healey is set to deliver his first Budget in the House of Commons this afternoon, following Prime Minister's Questions. He is expected to announce several cost of living measures and tax changes.
Martin Lewis's reaction
Mr Lewis, who visited No 11 on the morning of the fiscal statement, said on X: "I've just come out of a meeting with the Chancellor. The gas standing charge will be scrapped in 2027 (my guess, either for 1 Oct price cap or the 1 Jan 28 price cap)."
He added: "Having campaigned against the moral hazard of standing charges for years, I'm pleased. It's currently £108 a year. That cost will be shifted onto unit rates. We don't know how much yet, but I suspect just under 1p per kwH."
Impact on households
Mr Lewis said "about 60% of people will pay less due to this, 40% more", with the dividing line "somewhere around 12,500 kilowatt hours of gas". He called for support for vulnerable higher users who will have to pay more.
He also noted the Chancellor said he will discuss with Ofgem how to remove the charge on electricity, but that this is "trickier" and will take longer. Mr Lewis said the biggest issue in energy is the expected 27% rise in the price cap in January, and he asked the Chancellor whether he will intervene on that.
Mr Lewis said he was told he would have to wait for the Budget, but "reading between the lines, yes, there will be an announcement today". He suggested possible measures could include an increase in the warm home discount or a payout for people in council tax bands A-D.
