## What's standing charge? What does price per unit mean and how does the Price Cap affect me?

Your supplier sets both a standing charge and a unit rate for your electricity and gas.

The standing charge is a fixed daily charge that is designed to cover a variety of fixed costs in the energy system. Under the October 2022 Energy Price Guarantee, this is around 46p per day for electricity and 28.5p per day for gas.

For each unit of energy you use you pay the unit rate. Under the October 2022 Energy Price Guarantee you'll pay around 34p/kWh per unit of electricity and 10.3p/kWh per unit of gas.

On the face of it gas looks cheaper, but the average UK home uses around four times as much gas as electricity, so on average the total spent on electricity and gas is quite similar.

The average UK home uses 2900 units of electricity a year and 12000 units of gas. The electricity spend for this home is £168 on standing charge, plus £986 for the 2900 units, giving a grand total of £1154. The gas cost would be £104 on standing charge, plus £1236 on the 12000 units of gas for a total of £1340 on gas.