⚡ Ofgem’s Update on TNUoS Charges – What It Means for Electricity Contracts

The UK energy landscape continues to evolve, and one of the most significant cost drivers for electricity consumers in the coming years will be Transmission Network Use of System (TNUoS) charges. Ofgem has recently confirmed substantial increases to these charges, which will directly affect electricity costs for businesses of all sizes.

What Are TNUoS Charges?

TNUoS charges are fees paid to National Grid to cover the cost of operating, maintaining, and investing in the high-voltage transmission network that delivers electricity across Great Britain. These costs are recovered from suppliers and generators, and ultimately passed on to end users as part of their electricity bills.

What’s Changing?

Ofgem’s latest update signals that TNUoS charges will rise significantly from April 2025 onwards. The main drivers include:

• Higher investment requirements to support grid reinforcement and the transition to low-carbon generation.
• Regional cost differences, with businesses in certain parts of the UK facing steeper increases depending on their location.
• Shifts in methodology, following Ofgem’s Targeted Charging Review, which are redistributing charges more heavily onto demand users.

For some businesses, particularly energy-intensive users, these increases could represent one of the largest non-commodity cost uplifts seen in recent years.

Implications for Electricity Contracts

For organisations on flexible contracts, future TNUoS costs will continue to be passed through. Where rates are still indicative, final values will only be confirmed once National Grid publishes updated tariffs. This means budgets should include contingency for higher-than-expected costs in 2025/26 and beyond.

For those on or considering fixed contracts, it’s important to note that many suppliers are not currently offering full fixes on non-commodity elements like TNUoS. This limits opportunities to lock in certainty, though options may re-emerge closer to implementation dates.

Next Steps

We will continue to keep you updated as Ofgem and National Grid release further detail. In the meantime, we recommend reviewing your electricity contract structures and budget forecasts to ensure you are prepared for the upcoming changes.

If you would like a bespoke analysis of how the new TNUoS charges will affect your organisation, please get in touch with us at hello@gleg.co.uk – we’re here to help.