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Small businesses urge Ofgem to act over fast-growing standing charges on bills

Document Cited in Related
Vincent
Published date25 April 2024
Publication titleDaily Mirror, The: Web Edition Articles (London, England)
The Federation of Small Businesses FSB has lodged a complaint with Ofgem, the energy regulator, pleading for action against the rapidly increasing standing charges that affect smaller companies, especially those located in rural areas. An example came from one business owner who saw his daily standing charge rise steeply from 70.94p in July 2021 to 969.64p by September 2023. That's more than 13 times the initial amount

These standing charges aren't dependent on the amount of energy being used. Instead, they help cover the cost of supplying energy to both homes and businesses all across the UK. They also help take care of the expense involved in building new network infrastructure and ensuring that power continues uninterrupted when energy suppliers fall into bankruptcy.

However, while householders have the protection of an energy price cap, such protection doesn't extend to small businesses. Tina McKenzie, chairwoman of the FSB policy team, said: "We want Ofgem to do a thorough review of standing charges for businesses as well as consumers, for better transparency and to discern whether energy companies are behaving fairly towards their small firm clients."

"Small business energy customers behave in a way more akin to consumers than big businesses, lacking the resources, the expertise and the buying power necessary to get the best possible deal out of their energy suppliers. However, they do not benefit from anything like the same level of protection as that rightly available to households, leaving them caught between two stools."

"Many small businesses could be forgiven for suspecting that they have been seen as something of a soft...

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