Prices and tariffs · Tariffs
Low and zero standing-charge tariffs
A tariff with a low or no standing charge sounds cheaper, but it almost always has a higher unit rate. It pays only if you use little energy.
Updated 2 October 2026 · energy.org.uk editorial team
The short answer
There is a break-even level of use. Below it, the low standing-charge tariff costs less; above it, the normal tariff with a lower unit rate wins. The standing charge calculator finds that point for the two offers you are comparing.
How the break-even works
break-even kWh a year = (difference in standing charge × 365) ÷ (difference in unit rate)
For example, with illustrative rates: a normal tariff at 27p/kWh and 55p a day against an offer at 32p/kWh with no standing charge. The offer saves 55p × 365 = £200.75 a year in standing charges but costs 5p more for every kWh. It stops paying at £200.75 ÷ 5p = about 4,000 kWh a year. A home using 1,500 kWh would save about £125; a home using 6,000 kWh would pay about £100 more.
Check
What to check first
- Both charges on both tariffs. Compare unit rate and standing charge together, never one alone.
- Your yearly use in kWh, from your bill.
- Tiered tariffs. Some charge a higher rate for the first units each day or month instead of a standing charge. These need their own sums.
- Eligibility and terms. Check payment method, meter type, contract length and exit fees.
Who it can suit
- Homes empty for long periods, such as second homes.
- Very low users, for example a small flat with gas used only for cooking.
It rarely suits homes with typical or high use, or electric heating.
Do
Practical next steps
- Find your yearly kWh.
- Enter the offer's rates in the standing charge calculator.
- If you use less than the break-even, check the offer's other terms before switching.
Take care
Important limitations
- The calculation uses flat rates for a whole year.
- For gas, the same maths applies: compare unit rate and standing charge at your gas use.