From 2026, your business energy bill might see a spike—but not because you’re using more power. Here’s what’s changing, and how to stay ahead.
Ofgem has published its Draft Determinations for the RIIO-ET3 price control period, which sets the allowed revenues for UK electricity Transmission Owners (TOs) from April 2026 to March 2031.
These allowed revenues directly influence the Transmission Network Use of System (TNUoS) charges that appear on your electricity bills—specifically within the non-commodity standing charges.
The initial draft suggests a dramatic increase in these charges starting in 2026–27.
What are the headline figures?
- +82% increase in TOs’ allowed revenue from 2025–26 to 2026–27 (not adjusted for inflation).
- +50% increase even after adjusting for inflation, compared to the previous National Energy System Operator (NESO) projections.
NESO had already forecast a 25% average rise in TNUoS charges — this new determination may add another significant uplift.
The final figures will be confirmed by Ofgem in their Final Determination later this year
What are Transmission Owners (TOs)?
TOs, or Transmission Owners, are companies that are responsible for owning, operating, and maintaining the high-voltage electricity transmission networks in the UK.
What is RIIO-ET3?
RIIO-ET3 refers to the third RIIO (Revenue = Incentives + Innovation + Outputs) price control period set by Ofgem for TOs.
It spans from April 2026 to March 2031 and determines the allowed revenues for these TOs.
These allowed revenues directly influence the Transmission Network Use of System (TNUoS) charges that appear on electricity bills, specifically within the non-commodity standing charges.
Recent announcements, such as National Grid’s £8bn clean energy infrastructure overhaul, highlight why Ofgem is setting higher allowed revenues for Transmission Owners in RIIO-ET3.
While this investment is essential to enable more renewable energy and meet the UK’s net zero goals, the cost will be felt by businesses through higher TNUoS charges from 2026 onwards.
What does this mean for my business?
- Higher non-commodity costs: You could see a substantial rise in your standing charges from April 2026.
- Procurement challenges: Some suppliers have already moved to pass-through pricing for TNUoS due to the uncertainty. This may limit the availability of fully fixed-price energy contracts.
- Budgeting uncertainty: Businesses that rely on fixed budgets for energy may struggle to predict costs accurately without visibility on final TNUoS levels.
What are my options?
- Lock TNUoS into your contract
Pros: Budget certainty
Cons: Likely includes a risk premium
- Pass-Through TNUoS
Pros: Potential cost savings if risk doesn’t materialise
Cons: Exposes you to charge increases
- Hybrid Strategy
Pros: Control core costs while managing volatility
Cons: Requires strong forecasting and monitoring
What should my next steps be?
We recommend:
- Reviewing your current energy contracts, especially those ending before April 2026.
- Discussing pass-through vs fixed pricing strategies with us to assess your risk appetite.
- Staying engaged with the market — these charges aren’t set in stone yet, the final Ofgem determinations are expected later this year.
How can Consultiv Utilities help?
At Consultiv Utilities we are:
- Modelling the impact of RIIO-ET3 on your sites.
- Advising on optimal contract structures in light of market volatility.
- Comparing supplier offerings to ensure fair and consistent treatment of non-commodity costs.
- Exploring opportunities to reduce TNUoS exposure through demand-side flexibility or on-site generation.
Please get in touch to book a consultation with one of our team.
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