How power standing prices are altering as Martin Lewis slams ‘disappointing’ plans

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Your help makes all of the distinction. Learn extra Ofgem has introduced that main modifications are coming to power tariffs as quickly as subsequent yr because it recommends suppliers be required providing a minimum of one take care of decrease standing prices.

The power regulator stated it desires to provide customers extra alternative on how they pay the flat-rate prices, with the plans set to permit households to pay the prices as a part of their unit charge by decreasing the every day mounted quantity.

Which means that it’s unlikely payments will really be lowered by the modifications, Ofgem has defined, because the cost is simply moved from one a part of the invoice to a different.

The proposal comes after calls from campaigners to scrap the flat-rate standing cost, which is utilized every day no matter how a lot power the shopper makes use of.

Tim Jarvis, director basic of markets at Ofgem, stated: “We’ve listened to hundreds of customers that needed to see modifications to the standing cost and brought motion.

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The boss of Centrica claimed that Ofgem will not be correctly imposing the rule that got here into drive earlier this yr (Alamy/PA) “We've rigorously thought of how we will provide extra alternative on how they pay these mounted prices, nonetheless we've taken care to make sure we don’t make some prospects worse off.

However he added: “We can't take away these prices, we will solely transfer prices round.

“These modifications would give households the selection they've requested for, nevertheless it’s vital that everybody rigorously considers what’s proper for them as these tariffs are unlikely to scale back payments on their very own.”

What's the criticism of the plans?

Many campaigners now say the brand new plans really useful by the power regulator don't go far sufficient. Reacting to the announcement, cash professional Martin Lewis stated they have been “disappointing,” pledging to “robustly push again.”

"The core drawback is it would not appear like it's going to be underneath the worth cap mechanism. That results in two huge attainable issues," he instructed ITV’s Good Morning Britain.

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Firstly, he stated, there may be not restrict to what corporations can cost, so they may cut back the standing cost while rising the unit charge far past what is required to compensate for it.

<img src="https://static.independent.co.uk/2025/09/02/10/49/Martin-Lewis-on-scammers-using-his-image.png" srcset="https://static.independent.co.uk/2025/09/02/10/49/Martin-Lewis-on-scammers-using-his-image.png?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2025/09/02/10/49/Martin-Lewis-on-scammers-using-his-image.png?quality=75&width=640&auto=webp 640w" loading="lazy" alt="" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

(ITV) Secondly, Ofgem didn't carry ahead his proposal to default lower-income households to whichever tariff is greatest for them, that means it's unlikely many will change to this new tariff.

He criticised Ofgem “smothering” probably workable modifications to standing prices in a “pillow of forms.”

Gillian Cooper, director of power at Residents Recommendation stated: “Plans to supply a decrease standing cost - the mounted value of being related to the electrical energy provide - could present extra option to customers, however gained’t convey down individuals’s payments.

“There’s an actual threat that these with increased power wants, like some older or disabled individuals, might find yourself paying extra in the event that they select one in all these tariffs, so it’s essential persons are supported to make the suitable alternative when this feature turns into extra extensively obtainable from January.”

What occurs subsequent?

Ofgem is now launching one remaining session on the plans, with goals to decide by the top of the yr, paving the way in which for the brand new tariffs to be obtainable to everybody throughout Britain by the top of January.

The power regulator says it dropped earlier plans for tariffs with zero standing prices and far increased unit charges, as this might have unfairly impacted customers with excessive power wants, comparable to those that depend on energy for medical causes.

It's also seeking to introduce a minimal utilization on to the brand new tariffs in order that these with second properties or properties left vacant for lengthy intervals don't disproportionately profit.

The proposals come forward of a two per cent rise in power prices when the subsequent worth cap change takes impact on 1 October, which is able to see the invoice for a typical family rise from £1,720 to £1,755 a yr.

Martin McCluskey, minister for power customers, stated: “Customers ought to have freedom and selection when selecting an power tariff that works for them.

“This proposal will make extra tariffs obtainable in the marketplace, giving individuals extra choices to pay decrease standing prices if that fits their wants.”