RIIO - ET3 and increasing costs

How TNUoS costs are set to rise As the UK pushes towards a low-carbon energy system, there has been a sharp rise in costs for businesses connected to the grid. The National Energy System Operator (NESO) has released its latest five-year outlook on Transmission Network Use of System (TNUoS) charges, and -- from April 2026 – energy costs will rise significantly to fund the country’s energy transition. What Are TNUoS Charges? NESO uses the funds from TNUoS charges to build, operate, and maintain the high-voltage transmission network across Britain. The forecasts for 2026/27 have indicated that NESO will be looking to almost double the revenue generated in the previous year. While suppliers pass these charges on to both households and businesses, the scale of the increases ahead will be most acutely felt by large energy users.

ESOS Phase 4: What Businesses Need to Know The Energy Savings Opportunity Scheme (ESOS) Phase 4 is underway, starting on 6 December 2023, with a compliance deadline of 5 December 2027 . UK businesses must understand ESOS Phase 4 eligibility , key changes, and deadlines to ensure compliance and avoid penalties. This guide covers everything you need to know about ESOS Phase 4 for UK businesses . Who needs to comply with ESOS Phase 4? The ESOS Phase 4 eligibility criteria remain consistent with Phase 3. Your organisation qualifies as a “large undertaking” if, on the qualification date of 31 December 2026 , it meets all of these requirements: Based and registered in the UK Employs 250 or more people Has an annual turnover above £44 million Has an annual balance sheet total over £38 million To confirm your ESOS Phase 4 eligibility , visit our site and answer the questions to see if your business should be participating. Even if you don’t currently meet these criteria, crossing the threshold by the qualification date means you must submit a compliance notification by the ESOS Phase 4 deadline of 5 December 2027 . If your business qualified for Phase 3 but no longer meets the criteria, you must submit a “Do Not Qualify” (DNQ) notification via the Environment Agency’s MESOS portal. Key requirements for Phase 4 Phase 3 introduced the requirement for organisations to create an Action Plan that set out how you intend to cut energy use and when. That same principle continues in Phase 4, along with mandatory progress reporting in the years that follow. However, there are some updates to note: Action plan progress must now be included within your ESOS assessment. If commitments aren’t met, your business will need to explain why. Display Energy Certificates (DECs) and Green Deal Assessments (GDAs) are no longer valid routes to compliance. While net zero reporting will not yet be mandatory, you can choose to adopt the new PAS 51215 standards for voluntary energy and decarbonisation reporting. This could give your organisation a head start before net zero requirements arrive in Phase 5. These ESOS Phase 4 key changes ensure businesses focus on actionable energy efficiency measures and transparent reporting.

August Review By Adam Novakovic August was a month that saw the return of domestic football and the return of one of the most prolific energy narratives of the last 5 years, as the conflict between Russia and Ukraine once again dominated the headlines.

Nuclear Regulated Asset Base Levy: What It Means for Your Electricity Bills From this autumn, UK businesses will see a new charge appear on their electricity invoices: the Nuclear Regulated Asset Base (RAB) Levy. This charge will help finance new nuclear power stations such as Sizewell C, but it also means yet another non-commodity cost will be added to bills. What is the RAB model? The Regulated Asset Base (RAB) model is not new and has been used for decades to fund water networks, energy grids, and other large-scale infrastructure. Instead of waiting until projects are completed, it allows investors to receive steady returns during construction. The aim is to lower the overall cost of borrowing by sharing risk between developers, government, and consumers. In 2022, the Nuclear Energy Financing Act cleared the way for this model to be applied to nuclear energy. The logic is that by reducing financial risk, investors will be more willing to commit to long-term projects. For the government, it helps accelerate the nuclear build-out that is essential to the UK’s 2030 clean power targets. For consumers, however, it means paying towards new power plants years before they produce a single kilowatt-hour and before they can help lower unit rates.

Why electricity prices keep going up By Adam Novakovic Electricity has always been more than just a utility it is an essential component in every part of UK business. Yet in recent years, costs have been climbing steadily, and today’s bills are weighed down by more than just wholesale market prices. There can be long periods of time where wholesale prices remain stable or decrease, yet the amount businesses are paying for their electricity continues to rise. A large part of the increase comes from policy decisions. Most notably the way the UK has chosen to fund decarbonisation, its reliance on renewables, and its failure to make a serious commitment to nuclear energy.

Back Billing: Understanding OFGEM Rules and Avoiding Unexpected Energy Costs in the UK Recently we have been seeing an increase in suppliers issuing invoices for charges that are more than 12 months old. Back billing can catch UK businesses and households by surprise, leading to unexpected energy costs. This guide explains what is back billing , the OFGEM back billing rule , and practical steps to avoid energy back bills. What Is a Back Bill? Back billing occurs when an energy supplier issues an invoice for energy used but not previously billed accurately. This could result from missed meter readings, estimated charges, or issues with consumption data. These bills can cover usage from weeks, months, or even over a year, leading to significant unexpected costs for UK energy users. The 12-Month Back-Billing Rule The OFGEM back billing rule protects domestic energy users and microbusinesses in the UK. Under OFGEM regulations, suppliers cannot charge for energy used more than 12 months ago if: You never received an accurate bill for that period, even after requesting one. You were not informed of charges through a statement of account. Your Direct Debit was set too low to cover actual usage, and the supplier failed to adjust it. This OFGEM back billing rule ensures suppliers cannot unfairly burden customers with old charges due to their own errors. Exceptions to the OFGEM Back Billing Rule You may be liable for charges older than 12 months if the billing issue is your fault. For instance, if you deliberately prevented meter access or ignored billing requests, suppliers can back-bill for up to six years. Understanding these exceptions can be key to managing back billing on UK energy invoices.

July was a month that saw an England international football team lift a trophy and the unfamiliar events weren’t just limited to the sporting arena. For the first time in recent memory, it wasn’t geopolitics and international conflicts that were the main drivers behind movements in the energy market. In this article we review the factors that did cause energy prices to change and how prices are likely to move for the remainder of 2025.

EII Support Levy UK: Understanding the Charge and Exemptions for Businesses The EII Support Levy UK is a new charge impacting energy bills for many UK businesses. Introduced in April 2025, this levy funds the Exemption Scheme for Energy Intensive Industries (EIIs) , ensuring UK businesses with high energy costs remain competitive internationally. This guide explains what is EII Support Levy energy bills , who needs to pay it, and how to navigate EII exemption UK businesses to manage energy costs effectively. What Is The EII Support Levy? The EII Support Levy is a government-introduced charge added to non-domestic energy bills to support the EII Exemption Scheme . This scheme reduces energy costs for businesses classified as Energy Intensive Industries (EIIs) , identified by specific SIC codes. Non-EII businesses bear the cost of this levy to offset exemptions for EIIs, helping energy-intensive sectors stay competitive in global markets. Which businesses need to pay it? All non-domestic UK energy users without an eligible SIC code classifying them as an Energy Intensive Industry must pay the EII Support Levy . The application of the charge varies by supplier, with some still clarifying their implementation methods. Businesses should confirm with their supplier how the levy is applied to their EII Support Levy energy bills .

June 2025 Review By Adam Novakovic The British summer is underway and it commenced with a heatwave, leading to record temperatures during the opening games of Wimbledon. However, energy prices would be largely dictated by events far away from the UK, as a need for cool heads in the Middle East was the primary driver of energy prices throughout June.