Standing charges on gas bills will be scrapped from next year for around 23 million homes, the Treasury has announced.
The charges are a fixed daily fee added to bills, regardless of how much gas a customer uses, and cost around £108 per year for a typical household.
The Treasury said Chancellor John Healey will today ask regulator Ofgem to remove standing charges “in 2027 or as soon as possible after”.
Healey will deliver his first Budget in the Commons on Wednesday afternoon and said the change will give families “breathing space” and make the energy system fairer.
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