Standby power refers to the electrical energy that is used by devices even when they appear to be turned off. Standby power allows electronics to turn on quickly, but means that they are constantly drawing some power from the electrical grid.
For the purpose of this discussion, there are two types of standby power: on-call power which allows devices to provide an energy service immediately. The other type of standby power is also known as vampire power, phantom power and phantom load.
On-call power comes from:
Standby power is vital for devices like thermostats and telephones with answering machines, as they require constant power in order to function. It also reduces warm-up time for electronic devices that can go into a 'sleep' or 'hibernate' mode. For remote controls, it helps maintain internal and external digital clocks.
Of course, the major disadvantage to standby power is the constant use of electricity.
Vampire power on the other hand comes from devices with AC adapters, with some older types wasting nearly 50% of of the supplied energy. When articles talk about how wasteful standby power is, these articles are almost always referring to this wasted power. It's important to note that this problem is largely solved with newer electronics.
Legislation in Canada, the United States and the European Union has reduced the wasted power from standby power in new electronics to very low levels (from ~50 W to ~0.5 W). Newer electronics, labelled with IV, V or VI (see Figure 1) have very little vampire power. If the power supply (that converts AC from the outlet to the DC needed for most electrical devices) doesn't have a label, it's probably old and drawing a fair amount of power. Likewise, if it's warm when it's plugged in, or humming, it's probably wasting electrical power. See Figure 2 below to see a time-line of how efficiency standards have improved to reduce wasted electricity in AC-DC converters.
For further information please see the related pages below:
For deeper reading specifically on this topic, CUI has an excellent document here, which explains the history, the needs and the plans for the immediate future. NRCan explain's the Canadian perspective here.