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TNUoS charges for businesses
TNUoS charges constitute approximately 10% of domestic and business electricity prices and cover the cost of operating and developing Britain’s high-voltage national grid.
There are two types of TNUoS charges:
- 75% of overall TNUoS charges are demand-based tariffs paid by homes and businesses with an electricity connection.
- The remaining 25% are paid by electricity generators connected to the national grid.
This guide explains how both elements of TNUoS charges work and how they impact domestic and business electricity bills. Here’s what we cover:
- What are TNUoS charges?
- How are TNUoS charges calculated?
- Demand TNUoS tariffs
- Generation TNUoS tariffs
- Zonal TNUoS charges
- TNUoS upcoming changes and forecasts for 2026/27
- How can businesses reduce TNUoS charges?
What are TNUoS charges?
The acronym TNUoS stands for Transmission Network Use of System. TNUoS charges cover the costs associated with operating and developing Britain’s high-voltage transmission network, often called the National Grid.
This differs from DUoS charges, which cover distribution costs through the regional distribution networks.
The national grid is independently owned and operated by three organisations that earn TNUoS charges:
- Scottish & Southern Electricity Networks – operates the transmission infrastructure in the Northern Scotland (part of the same group as SSE Business Energy)
- Scottish Power Energy Networks – operates the transmission infrastructure in the Southern Scotland (part of the same group as Scottish Power Business Energy)
- National Grid – operates the transmission infrastructure in England and Wales.
An organisation called NESO serves as the principal operator of the entire system and collects TNUoS charges on behalf of the three individual operators.
How are TNUoS charges calculated?
TNUoS charges are designed to recover the cost of operating, maintaining, and expanding the national grid in Britain.
Here are the steps taken to calculate TNUoS charges each year to cover these costs.
1. Forecast total allowed revenue
Each year, NESO determines how much money will be paid to the three grid operators in the coming year to fund:
- Capital investments
- Operating costs
- Maintenance
This process determines the total TNUoS charge target. This was £5.3 billion in 2025/26 and is forecast to be £6.2 billion in 2026/27.
The total target is split between demand and generation charges, which determines how much each type of TNUoS charge will aim to generate in the upcoming year.
2. Zonal tariff calculations
The TNUoS tariffs contain separate rates for different geographical zones for both demand and generation charges.
NESO runs a model that simulates typical transmission system conditions to calculate the marginal cost impact of injecting or withdrawing power in each zone.
The output of this model is used as the basis for the zonal tariffs.
3. Residual tariff calculations
A forecast of expected generation capacity and consumer demand is used to calculate the required residual TNUoS tariffs (non-zonal charges).
The tariff rates are adjusted such that the total forecast charges equal the forecast total allowed revenue from the first step.
4. Tariff publication
NESO typically publishes provisional TNUoS tariff information in November relating to the new rates that apply from 1st April.
These provisional rates are then adjusted as NESO makes final refinements to its forecast. In January, the final TNUoS charges are published on the NESO website.
Demand TNUoS tariffs
Demand TNUoS tariffs are levied on all homes and businesses connected to the electricity grid in Britain.
There are three types of demand-based TNUoS charges:
- Fixed daily charges – these constitute the majority of demand-based TNUoS charges.
- Location-based charges – an additional charge for certain locations.
- Triad period demand – an additional demand-based charge for industrial users during times of peak demand on the network.
Fixed daily demand charges
The majority of TNUoS demand-based charges paid by users of electricity are a fixed daily charge that changes annually and depends on your type of electricity connection.
The table below shows the TNUoS charges in 2025/26 for each type of domestic and business electricity connection.
| Type of business electricity connection | Maximum Import Capacity (KVa) | 25/26 final charges (£/day) |
|---|---|---|
| Domestic | N/A | £0.14 |
| Non-half hourly business low consumption | N/A | £0.15 |
| Non-half hourly business low/medium consumption | N/A | £0.36 |
| Non-half hourly business medium consumption | N/A | £0.76 |
| Non-half hourly business high consumption | N/A | £2.07 |
| Half-hourly LV1 | 0-80 | £3.91 |
| Half-hourly LV2 | 80-150 | £6.53 |
| Half-hourly LV3 | 150-231 | £10.25 |
| Half-hourly LV4 | 231+ | £22.74 |
| Half-hourly HV1 | 0-422 | £21.83 |
| Half-hourly HV2 | 422-1000 | £62.80 |
| Half-hourly HV3 | 1000-1800 | £121.80 |
| Half-hourly HV4 | 1800+ | £317.60 |
Source: NESO TNUoS scheme of charges 2025/26
A quick explanation of the types of electricity connections in the table above, with links to our detailed guides:
- Non half-hourly business customers – (MPAN Profile Classes: 01-04), generally small business energy customers.
- Half-hourly business customers – (MPAN Profile Classes: 00, 05-08), energy-intensive commercial properties with a half-hourly electricity meter.
- Maximum Import Capacity – the maximum demand your business can draw from a connection as agreed with your distribution network operator.
💡TNUoS charges will continue to use separate methodologies for half-hourly and non-half-hourly customers, despite the upcoming market-wide half-hourly settlement reform.
Triad period demand
Industrial consumers of power pay an additional TNUoS charge based on their maximum demand during periods of peak demand on the national grid, known as “Triad periods,” which occur during the winter months.
The Triad period system incentivises large industrial electricity users to reduce consumption when demand is highest, helping to balance supply and demand across the entire system.
Generation TNUoS tariffs
Generation tariffs are paid by sites that generate electricity and export it directly to the national grid.
Generation TNUoS charges are based on the Maximum Export Capacity (in kW) of each facility.
The largest generators, such as the Drax power plant and the planned Sizewell C nuclear power station, pay the highest charges.
The charge per kW of capacity depends on the following two factors:
Type of electricity generation
TNUoS generation charges depend on a “load factor,” a measure of how each type of generator uses the national grid from day to day.
There are three types of load factors for generation TNUoS charges:
Conventional low-carbon generators
Conventional low-carbon generators produce steady outputs of electricity throughout the year. The most common example of the traditional low-carbon generation is UK nuclear power plants.
Conventional low-carbon generators pay the highest TNUoS charges because they consistently utilise the transmission network, unlike other generation types.
Intermittent renewable generation
Intermittent renewable generators produce electricity only in certain weather conditions, with UK wind farms being the most common example.
Intermittent renewables pay medium-level TNUoS charges as they frequently export power onto the grid but with variable timing, resulting in moderate transmission usage.
Conventional carbon generators
Fossil fuel-based electricity generators, most commonly UK gas power stations, pay the lowest TNUoS charges.
Conventional carbon generators are responsive, exporting power to the transmission network only when there is sufficient demand for the electricity they generate.
The lower TNUoS charges reflect the valuable role these generators play in balancing the grid.
Zonal TNUoS charges
Both demand and generation TNUoS charges include locational components that depend on where users are connected to the national grid.
Great Britain is divided into the following TNUoS charging zones:
- 27 generation zones
- 14 demand zones
The zonal system is designed to reflect the cost of transmission from different locations.
For example, electricity generated by a wind farm off the coast of Scotland travels a long distance to reach the demand centres in southern England, compared with power stations located in the Midlands.
The zonal system aims to charge TNUoS fees that reflect the cost their location imposes on the national grid.
TNUoS demand zones
An additional TNUoS charge is levied on all domestic and business electricity connections in locations where transmission through the national grid is longest.
Zonal TNUoS demand charges are applied as follows:
- Half-hourly customers – charged based on the capacity of a business electricity connection, measured in kW.
- Domestic and small business users – charged per kWh of electricity consumed.
The following table sets out the TNUoS zonal demand tariffs for 2025/26:
| Zone | Zone Name | HH Demand Tariff (£/kW) | NHH Demand Tariff (p/kWh) |
|---|---|---|---|
| 1 | Northern Scotland | - | - |
| 2 | Southern Scotland | - | - |
| 3 | Northern | - | - |
| 4 | North West | - | - |
| 5 | Yorkshire | - | - |
| 6 | N Wales & Mersey | - | - |
| 7 | East Midlands | - | - |
| 8 | Midlands | 2.99 | 0.39 |
| 9 | Eastern | 1.11 | 0.15 |
| 10 | South Wales | 6.89 | 0.81 |
| 11 | South East | 5.57 | 0.77 |
| 12 | London | 7.41 | 0.81 |
| 13 | Southern | 7.57 | 0.99 |
| 14 | South Western | 10.12 | 1.38 |
Source: NESO TNUoS scheme of charges 2025/26
TNUoS generation zones
The country is divided into 27 zones, where each generator pays the same locational charge per MW of generation capacity.
TNUoS zonal tariffs for generators can be either positive or negative. Zones that increase network stress are charged, whereas zones that relieve network congestion or are close to demand centres receive a TNUoS credit.
Embedded Export Tariff TNUoS credit
Embedded generators are those not directly connected to the high-voltage transmission system but instead to the lower-voltage regional distribution networks.
Examples include small-scale solar farms, CHP plants, and onshore wind turbines.
Unlike generators connected to the national grid, embedded generators are exempt from paying TNUoS charges.
The Embedded Export Tariff provides a credit to any generators embedded in an area of high demand in the South of England, as they reduce the need for long-distance transmission over the national grid.
TNUoS upcoming changes and forecasts for 2026/27
TNUoS charges for 2026/27 are expected to increase significantly, with the latest documents from NESO indicating a £1 billion rise in the allowed revenue of the national grid operators, bringing the total to £6.2 billion.
The Contracts for Difference scheme is successfully encouraging the development of new offshore wind farms in the North Sea. The significant quantities of power generated by these projects must be distributed to areas of highest demand in the South East, requiring major reinforcement work to the grid.
The additional revenue for the grid operators will fund the development of transmission capacity needed to connect these new wind farms to the grid.
The role of Ofgem in regulating TNUoS charges
Ofgem, the UK’s energy regulator, directly regulates TNUoS charges, approving the final charges each year to ensure they fairly reflect the use of the national grid.
Ofgem’s responsibilities include:
- Setting revenue limits: Ofgem determines the total allowed revenue that National Grid and other transmission operators can recover through TNUoS charges, ensuring costs are justified and reasonable.
- Approving charging methodologies: Ofgem reviews and approves the methodologies used to calculate TNUoS charges, including how costs are allocated between different regions, user types, and generation and demand customers.
- Encouraging efficiency: Through initiatives like the Targeted Charging Review (TCR), Ofgem assesses the fairness and predictability of TNUoS charges, aiming to balance costs between consumers and generators and promote efficient use of the transmission network.
Find out more in our guide to Ofgem’s role in business energy.
How TNUoS charges impact business electricity rates
Although TNUoS charges are applied separately for generators and users, both elements are ultimately paid by electricity users.
This section explains how TNUoS charges impact business electricity bills both through direct and indirect costs.
Direct impact of TNUoS on business electricity bills
Business energy suppliers pay demand-based TNUoS charges on behalf of their customers.
These demand-based TNUoS charges are typically included within the daily standing charge quoted in most business energy contracts.
The exception is pass-through business electricity tariffs, where your supplier will simply pass on any TNUoS and DUoS costs separately from the other components on your business electricity bills.
Indirect impact of TNUoS on business electricity bills
The largest component of business electricity bills is the commodity cost paid to electricity generators.
Electricity generators in Britain pay generation TNUoS tariffs for their connection to the national grid.
Generators then factor these TNUoS charges into the commodity cost per kWh that they charge to business electricity suppliers.
How can businesses reduce TNUoS charges?
TNUoS charges primarily depend on your business’s location and the capacity of its electricity connection, making them challenging to avoid.
However, our energy experts can suggest three effective strategies to help reduce these charges.
Triad avoidance
Large industrial consumers pay triad charges based on their maximum demand during specific peak periods in the winter months.
Triad avoidance involves monitoring grid demand forecasts to predict triad periods, then adjusting operations or using commercial solar batteries to reduce demand during those times significantly.
Lowering Maximum Import Capacity
The banding of demand-based TNUoS charges for businesses with half-hourly meters is based on the agreed Maximum Import Capacity.
These businesses can lower their TNUoS charges by agreeing to reduce their import capacity with their local distribution network operator.
For a detailed explanation, refer to our guide on maximum demand.
Negotiations with suppliers
TNUoS charges are paid by business electricity suppliers, who typically apply a markup before passing them through in the daily business electricity standing charges of the tariffs they offer.
Businesses can often secure a better deal by comparing business energy suppliers and finding a tariff with the lowest daily standing charges.
Use our business electricity comparison service today to find the lowest TNUoS charges currently available on the market.
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