Andy Burnham has set out plans to remove fixed daily charges from household gas bills as the UK prime minister seeks to show voters that his government is controlling the cost of living. Speaking in the House of Commons on Wednesday, Burnham said he had asked chancellor John Healey and energy secretary Miatta Fahnbulleh to report back on removing standing charges “at the earliest opportunity”.
Standing charges are daily fixed fees paid regardless of gas use, covering network upgrades and other costs. Energy experts said the proposals would probably recover those costs through the unit rate of gas. Nesta analysis indicates typical households could save £27 a year, although savings would be limited for low-use households and could penalise those using large amounts of gas.
Removing the charge could also narrow the gap between gas and electricity unit costs, encouraging more households to adopt heat pumps. Ben Westerman, director of policy and advocacy at Electrify Britain, called the proposal a positive step.
Burnham announced the plan hours after the government approved Jackdaw, a large new gasfield in the UK North Sea. The approval was immediately criticised by environmental campaigners. Cornwall Insight predicts typical household bills will rise by 16 per cent in January because of disruption to global fossil fuel supplies following the Iran war.
Source: Financial Times Companies · Summarized by HeadlinesBriefing