The Standing Charge is an item which everyone will have seen on their electricity bill, making up a significant portion of the total.

The Standing Charge can usually be found right below the electricity usage in kWH. But what is it, and why is it on your electricity bill?

Standing charges are fixed fees applied to all metered electricity users in Ireland, independent of how much electricity they use.

The standing charge covers the cost of providing gas or electricity to your property and servicing your account. This can cover things such as:

Exactly how a standing charge is fixed is decided by individual suppliers, and can vary based on many different factors.

Standing charges are fixed in the sense that they will not change over time, or vary based on electricity usage. However, different households will likely be paying different charges.

Standing Charges will vary depending on a number of factors. The first and most important of those is if you are an urban or rural electricity customer.

Rural customers will typically pay higher standing charges than urban customers because the costs of maintaining the electricity infrastructure are higher.

Other factors which affect standing charges include whether you have a standard or smart meter or if your electricity plan is for fixed or variable prices.

Smart meters do still have a standing charge, but these are usually lower than for 24hr or Day/Night meters since there is less work involved for the energy provider.

Some electricity plans may have the same standing charge for both rural and urban customers. However, people should check the unit rates when looking at electricity prices, as there is a chance that they may be higher for rural homes in this case.

Homes with night storage heaters who are on a 24hr meter will have a separate meter for their night storage heater use. This will also come with its own standing charge, albeit a much smaller one than for the regular electricity meter.

Like all other electricity products, standing charges are subject to VAT at a rate of 9%. Your energy bill will probably not display the prices with and without VAT. Instead, it will include an item showing all the VAT paid on everything in that bill.

Standing charges can typically be found on your electricity bill below the units of electricity used.

The standing charge will be listed at a daily rate multiplied by the amount of days covered in your billing period.

The standing charge you pay is set by your gas and electricity provider. However, the charge itself is meant to reflect the network charges which are levied on them by the Commission for Regulation of Utilities (CRU).

If the CRU increases network charges, which are usually applied for the coming year in November, the supplier may choose to pass that increase onto the customer.

The majority of electricity and gas customers in Ireland are on fixed-term, but variable-rate contracts. This means that prices, including standing charges, can be increased during the period of your contract.

If you are on a fixed rate contract, then your standing charge may also be fixed for the duration of the contract, usually 12 months. This is something you will need to check the terms and conditions of your contract to confirm.