Martin Lewis has called for the standing charge on energy across the UK to be slashed. The fixed amount which customers must pay on top of the units of energy used - which currently sits at £300 annually - must be paid regardless of gas and electricity consumption.
Which in-turn means that even if you use no energy whatsoever for a full year, and your usage amounts to £0 - you'll still need to pay the basic standing charge regardless. These charges are used to pay for things like energy grid upkeep, and the amount varies depending on your location of residence across the UK.
Money Saving Expert founder Martin has previously called for the charge to be slashed, labelling it a 'moral hazard' which 'disempowered' hard-working bill payers across the board. Taking to Twitter, the financial guru, wrote: "The high energy standing (daily) charges are a moral hazard and should be reduced. It is outrageous that people have to pay £300/yr just for the facility of having gas & electricity even if they use none."
Read more: Martin Lewis fan saves £926 on holiday after following clever travel tip
The Mirror reports that Martin also detailed how higher standard charges mean that lower users save 'proportionally less and less' when reducing their usage. He went on: "I have long campaigned for lower standing charges. MSE is submitting a consultation on this about shifting some of the cost the the unit rates.
"The reason Ofgem mandates firms to have high standing charges in the price cap is because they use it to pay for the 'fixed costs' of energy (distribution, transmission etc) - which it believes should be mostly shared equally. It is especially loaded onto the electricity standing charge as that is 'more universal'."
And Martin is not the only person who has called for imminent change, with Centrica's boss - who own British Gas - said that those attempting to make savings were being hit the 'hardest' by the standing charge.
Chris O’Shea told the Sun: "The standing charge hits those who are careful about their energy use hardest – and these are often people from low-income households and prepayment meter customers. I know from conversations with prepayment customers that the standing charge can see them unknowingly build up debts over the warmer summer months."
Martin has in-turn called for a more 'progressive split' on standing charges. Returning to Twitter, he added: "I think a more progressive split would be better, by putting a bigger proportion of the cost on the unit rate. And in past polls I've done on here the huge majority agree.
"One stumbling block is the argument from Citizens Advice, an organisation I have great respect for. Its concern is that if you shift the burden, some vulnerable people with disabilities and medical issues that make them high users will suffer.
"Of course, the correct solution to that is lower the standing charge but give them separate support. Yet that would involve an energy market that wasn't broken and the regulator and Government to operate in concert."
The Money Saving Expert also noted that the UK was stuck in a 'chicken and the egg situation' and the 'fairest' thing to do is to lower the charge and provide help to the highest using vulnerable parties at the same time. He went on: "Yet I wanted to bash this out quickly as I saw much debate on it after my earlier tweets, and I wanted to explain some of the bigger picture."
