standbytariff

A standby tariff is a charge applied by a utility company, typically for electricity or gas, when a customer's connection is maintained but not actively used. This is common in situations where a property is vacant or a business has temporarily ceased operations. The standby tariff covers the costs associated with keeping the utility infrastructure ready to deliver service on demand, such as maintaining the physical lines, transformers, and the overall readiness of the grid.

The rationale behind standby tariffs is that even without consumption, the utility incurs expenses to ensure service can be instantly restored. These costs are distributed among customers who maintain active connections but may have periods of low or no usage. It prevents those who do consume energy from disproportionately bearing the fixed costs of maintaining the entire system. The specific rates and conditions for standby tariffs vary significantly between utility providers and are often detailed in their service agreements or tariff schedules. Customers who anticipate extended periods of non-use may be able to reduce or eliminate these charges by formally disconnecting their service, although this may involve reconnection fees.