19 Mar TNUoS Charges set to rise in April
TNUoS Residual Charges Set to Rise Sharply, What Businesses Should Expect From 2026
From April 2026, UK businesses will face a major increase in electricity network costs. The fixed portion of Transmission Network Use of System (TNUoS) charges, known as residual charges is forecast to nearly double within a year.
These charges are applied as a daily cost per meter rather than per unit of electricity used. This means businesses cannot reduce them simply by lowering energy consumption, they will appear directly in standing charges.
Industry forecasts show residual charge revenue increasing dramatically between 2025/26 and 2026/27, with further growth expected throughout the decade.
Why costs are increasing?
The sharp rise is largely due to significant investment in the UK’s electricity grid. Billions of pounds are required to:
Connect new renewable energy sources (such as offshore wind and solar)
Upgrade ageing infrastructure
Strengthen the network to handle changing demand patterns
These upgrades form part of a new regulatory period (RIIO price controls), which allows network operators to recover higher costs through charges to users.
In simple terms, businesses are contributing to the cost of building a more modern, low-carbon energy system.
How businesses will be affected?
1. Higher standing charges
Most companies will see the increase through higher fixed daily costs. Even contracts labelled as “fixed” may still pass on these changes if TNUoS is treated as a pass-through charge.
2. Banding and capacity thresholds
Charges depend on voltage level and agreed capacity. Businesses close to a threshold could move into a higher band, leading to much larger costs.
3. Regional differences
Costs will vary by location. For example:
Southern regions are expected to see higher peak-time costs
Northern regions may remain lower due to surplus generation
This means similar businesses in different areas may face very different bills.
The bigger picture
By the end of the decade, most TNUoS costs are expected to come from fixed standing charges rather than usage-based tariffs.
This represents a fundamental shift:
Historically costs linked more to energy use
Going forward costs increasingly fixed per site
Example impact on different sites
The increase becomes more noticeable at higher voltage levels, where daily charges accumulate into large annual costs.
Medium-to-large sites could see tens of thousands in additional yearly costs
Very large industrial sites could face increases into the millions
This is because charges apply every day, regardless of energy usage.
Table below showing how annual residual charges may rise across different connection bands:
| Band | 2025/26 | 2026/27 | 2027/28 | 2028/29 | 2029/30 | 2030/31 |
|---|---|---|---|---|---|---|
| Domestic | £49 | £81 | £91 | £100 | £104 | £107 |
| LV1 | £1,426 | £2,116 | £2,542 | £2,968 | £3,280 | £3,606 |
| LV2 | £2,383 | £4,201 | £5,013 | £5,894 | £6,513 | £7,160 |
| LV3 | £3,742 | £5,249 | £6,262 | £7,363 | £8,136 | £8,945 |
| LV4 | £8,300 | £13,935 | £16,626 | £19,549 | £21,601 | £23,748 |
| HV1 | £7,968 | £11,621 | £13,937 | £16,430 | £18,178 | £19,998 |
| HV2 | £22,922 | £42,760 | £51,283 | £60,458 | £66,890 | £73,586 |
| HV3 | £44,455 | £67,677 | £80,862 | £95,149 | £105,173 | £115,648 |
| HV4 | £115,923 | £193,053 | £230,935 | £271,896 | £300,629 | £330,619 |
| EHV1 | £58,679 | £118,798 | £142,462 | £167,938 | £185,800 | £204,398 |
| EHV2 | £270,752 | £423,174 | £504,880 | £593,647 | £655,949 | £721,146 |
| EHV3 | £575,325 | £917,219 | £1,100,039 | £1,296,825 | £1,434,795 | £1,578,433 |
| EHV4 | £1,417,199 | £2,079,911 | £2,866,651 | £3,379,463 | £3,739,008 | £4,113,322 |
Key takeaway
From April 2026, electricity costs for UK businesses will increase, not necessarily because of higher energy usage, but due to rising fixed network charges.
The shift toward standing charges means:
Reducing consumption won’t fully protect against cost increases
Understanding contracts, capacity, and location will be more important than ever.
If you’ve agreed an energy contract within the past 12 months, the impact of these additional charges will depend on your supplier. In some cases, they may already be included within your fixed rates, while in others they could be passed through as separate costs.
If you have any questions about how these charges may affect your contract, please get in touch with our team and we’ll be happy to provide guidance.
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