How to work out if Standing Charge Option is best?

GoGas

In looking to change supplier from Scottish Power I currently have Online capped till March 2011 with a daily Standing (Service) Charge (SC). Most of Fixed rate deals seem to offer no standing charge but higher unit costs and the comparison sites seem to work on a yearly consumption. Presumably as your uses varies though the year for some a SC may be better value if they are using lots more in the winter compared to the summer as the daily unit cost on the heavy used as would be less overall.

1. Is this correct logic and how do comparison sites take this SC into account?
2. Does anybody know how best to work out if you are better off with standing charge or no standing charge?

thanks

Premier_2

A daily standing charge is rarely ever a lower price than a non-standing charge version of the same tariff. (but will usually be no worse if you use at least the tier 1 amount of units)

This is because the total cost of the standing charge usually equals the total premium added to tier 1 units (so only if you don't reach the tier 1 limit do you end up saving) Tier 2 units are usually the same price as the unit charge on the equivilent standing charge tariff.

Comparison sites assume you use energy equally over the year, and so will calculate price based on maximum tier 1 usage (and hence why it is the same price as a standing charge equivilent tariff, when your annual consumption exceeds the annual tier 1 amount)

Chances are with electricity, you exceed the tier 1 levels in each charging period. It can be different with gas (esp. if only used for heating); here you may use all you annual usage in the two winter quarters, and none in the summer quarters. The comparison sites don't allow for this.

GoGas

Thanks you for your very helpful and clear explanation. It seems in most circumstances it seems will not be an advantage or disadvantage which means I can ignore it in choice. The EDF fixed 2015 has no standing charge and the fixed 2013 does.

spiro

Agree with Premier, the key thing is will you use gas in the summer to heat your hot water? If the answer is yes then it is highly likely that you will use up all of your more expensive units every quarter and therefore the standing charge makes no difference. If however you heated you water by elec in the summer and used NO gas then none standing charge tariff would be better as you would use no expensive units in the summer and also not incur a standing charge.