Network charges and agreed capacity

NESO published the final 2026/27 transmission tariffs on 30 January 2026. The volume-weighted average residual increase is 64 per cent from April 2026. Across individual capacity bands the increase ranged from 28 to 116 per cent.

These are final published tariffs rather than forecasts. Further annual increases are planned through to 2030/31, funding the transmission investment programme approved under Ofgem’s RIIO-3 price control. Ofgem’s Final Determinations of 4 December 2025 approved £28.1bn of upfront expenditure across electricity transmission, gas transmission and gas distribution, within a wider investment pipeline of around £90bn over the five years to 2031.

Status: LawThis is regulated cost recovery applied equally to every supplier. No supplier can tender it away.

Ofgem’s Targeted Charging Review moved most transmission residual charging and around half of distribution residual charging away from usage and into fixed bands. For half-hourly metered sites, the band is set by agreed capacity.

The larger the capacity you reserve, the higher the band, and the higher the fixed charge, before a single unit is used. The bands were reviewed alongside the new price control in April 2026, so a site that sat comfortably in one band may now sit in a higher one for exactly the same operation.

Excess capacity is charged twice.

First on the daily availability charge, levied on every kVA reserved.

Second, and often larger, through the band. Capacity well above real demand can place a site in a higher fixed-charge band than its operation justifies, inflating the standing charge as well.

Capacity is usually set when a site is built or fitted out and then left untouched for years while the operation changes around it. Over-provision is common and rarely looked at.

Reducing agreed capacity to a level safely above true peak demand lowers the daily availability charge and, where it moves the site down a band, the fixed charge too. No behaviour change, no capital cost, no disruption, and the reduction recurs every year.

Two points of judgement matter.

Headroom is essential and excess is waste. Capacity must cover the genuine peak with safe headroom, and must allow for any on-site generation being unavailable. If the unit is down, the grid carries the whole load. Sizing too tight risks penalty charges on the peak day.

Review before you renew. A reduction takes effect going forward and can take up to four months through the network operator. It does not recover a fixed standing charge already committed in a contract. The time to right-size is before you sign.

1. 01Analyse. Half-hourly demand, true peak, power factor and current band, from your own data. We assess the peak on the half-hourly record, never on a momentary spike, and we do not recommend a reduction without a full year of it.
2. 02Size safely. A conservative capacity with genuine headroom, allowing for generation downtime and any known load growth such as EV charging, new kitchen plant or electric heat.
3. 03Apply. The application goes to the distribution network operator, not the supplier, who only passes the charge through. We complete and manage it.
4. 04Confirm. The lower daily charge, and any band change, flows through to the bills.

We charge a percentage of the first year saving, agreed in writing before we start, and the network operator work is completed within that. If the review finds no worthwhile reduction we will say so plainly.

Our remuneration is shown openly. The fee is an Omnium management fee and is never described as a network charge.

Where a site’s power factor is poor, that is a separate matter with its own charges and its own remedy. We flag it on its own rather than folding it into the capacity figure.