Transmission and network costs set to drive substantial increases in electricity bills from 1 April 2026

Businesses across the UK must prepare for a material increase in the non-commodity portion of their energy bills. Under the forthcoming regulatory framework RIIO‑3, covering the period 1 April 2026 to 31 March 203. The energy network operators will recover significantly elevated fixed and network-related costs, triggering surging charges for commercial users.

The scale of the challenge

The regulatory regime, defined by “Revenue = Incentives + Innovation + Outputs”, is designed to ensure network companies have adequate funding to deliver clean power infrastructure and support the UK’s Clean Power 2030 ambition. According to the draft determinations, electricity transmission investment may exceed £80 billion across the RIIO-3 period.

One of the most impactful cost drivers for businesses will be the rise in Transmission Network Use of System (TNUoS) charges. As the underlying network investment and system-balancing complexity grows due to renewables and electrification, transmission and distribution costs are projected to embed further into commercial tariffs.

What this means for businesses

While commodity costs (the cost of electricity and gas themselves) remain volatile, the structural increase in fixed and network charges means that companies cannot avoid bill escalation simply through consumption cuts. For example, a major transmission owner notes that much of the demand growth is being matched by “more system balancing and flexibility”, with costs borne by end users.

For large electricity users, network cost bandings, capacity allowances, and fixed charges (often known as RAB or “revenue adjustment-based” charges) are central to the impact. Many organisations are being advised to expect:

• A near 100% increase in some transmission fixed-charge components from April 2026.

• A further 15% annual uplift in line with investment ramp-up through to 2030.

  
  

  These figures illustrate the scale of bill inflation many businesses must factor into budgets.

Regional and usage-led variation

The impact varies significantly with usage banding, contractual arrangements, and network geography. Industrial and large commercial sites are especially exposed to changes in TNUoS and capacity (kVA) charges. In contrast, smaller businesses may face lesser uplifts, but the trend of rising non-commodity costs is common across sectors.

Furthermore, the increasing prominence of distributed generation, electrification and sector coupling means network operators must invest ahead of demand, a timing mismatch that drives upfront cost pressures now to deliver future cost savings. The regulator acknowledges this in stating that “we are working to support consumers through this transition”.

Why now?

RIIO-3 shifts more network risk and investment cost onto end users. Ofgem’s Sector Specific Methodology decision in July 2024 made clear that the framework intends to “fund the efficient transition to a clean power system while protecting consumers”. With transmission, distribution and gas networks submitting large business plans and where “capital investment may exceed £80 billion”, commercial users are already seeing early signals of elevated cost exposure.

A recent analysis by consultants notes that under the proposed scheme, TNUoS and other fixed charges may materially increase as network companies recover greater upfront investment costs.

How ECBS can help

At ECBS we are working with clients to mitigate the impact of these rising non-commodity costs. Our support includes:

• Re-forecasting procurement budgets for April 2026 onward.

• Reviewing and negotiating contract pricing terms to isolate fixed-network exposure.

• Evaluating capacity bandings (kVA/ASC) so businesses avoid unintended uplift.

• Providing visibility on how TNUoS, DUoS and other non-commodity charges may evolve over the remainder of RIIO-3.

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If your business is facing this transition and would like to explore how to stay ahead of network cost inflation, get in touch with us at www.ecbs.co.uk/contactus