The charges for using Great Britain’s electricity system

TNUoS tariffs aim to reflect the cost of using the network, to help network users make efficient decisions about where and when to use it. Charges vary by location, reflecting the costs that users impose on the transmission network to transport their electricity.

Demand users who pay half-hourly tariffs are charged according to what they used at the three highest peaks of system demand (known as triad periods – which cover the highest demand period between November and February each year). These tend to be large businesses. 

Generator users also pay based on a capacity value agreed between them and NESO – this is known as Transmission Entry Capacity or TEC.

There is also an embedded export tariff for those generators who are connected to the distribution network with TEC<100MWs. This is based on the generators export over the triad periods.

The charging methodology we use produces tariffs that vary by location based on how close a generator is to demand or how close the demand is to generation. 

This incentivises generators and demand to be close to each other reducing the need for investment in the transmission system. 

The methodology is defined in the Connection and Use of System Code (CUSC) and subject to industry open governance. NESO keeps the methodology under review and proposes changes where necessary as well as working with Ofgem and other stakeholders to identify areas for improvement.

Incremental changes

Incremental changes to charging methodologies happens through changing the industry codes (CUSC, DCUSA and BSC). Industry codes are 'live' documents, meaning they can be changed by parties raising code modifications.

This process of modifying codes is the open code governance process. Modifications can be proposed by code parties and, in some cases, other interested parties including Citizens Advice and Citizens Advice Scotland.

Each code has a panel or committee that oversees the assessment of proposed changes to that code. A general rule is that changes should only be made if they better facilitate that code’s ability to meet its objectives.

For some proposed changes, the code’s panel will also make the final decision on whether implementation is appropriate, but this is not always the case. Certain modifications require consent from Ofgem's governing body, the Authority.

You can find out more information on:

• industry code governance on Ofgem's website 
• the CUSC, including active code modifications, on the NESO website
• the BSC, including active code modifications, on the Elexon website
• the DCUSA, including active code modifications, on the DCUSA website

Guidance for raising a potential change

If you are considering a potential change to access and network charging arrangements, you are encouraged to follow Ofgem's Charging coordination guidance. This will outline how to coordinate your issue through the Charging Futures forum, task forces, and the open governance process. 

The Charging coordination guidance outlines:

• the recommended routes to raise your issue
• the criteria to help understand which route you should take
• who to speak to if you want to proceed with one of the routes, or are still unsure

If you are still unsure, please get in touch with Ofgem at [email protected] or with the lead secretariat at [email protected] who will help guide you through the coordination steps. 

Significant changes

Significant changes to charging methodologies can happen through a significant code review (SCR). Ofgem will undertake SCRs from time to time. An SCR provides a role for Ofgem to holistically review a code-based issue (for the main commercial industry codes) and speed up industry reform. 

More information on the SCR process can be found on Ofgem's website. 

Coordinating multiple significant changes 

Charging Futures is a coordinated approach to considering significant code reform related to access and charging arrangements. It takes a more strategic view of access and charging change by:

• making recommendations for significant change
• recommending how these should be taken through the open code governance process as individual modifications, or as an SCR