TNUoS charges explained

TNUoS stands for transmission network use of system. TNUoS charges are the part of an electricity bill that covers the cost of the national high-voltage transmission network, the towers and cables that carry power between regions before it reaches the local distribution network. For a large half-hourly site the charge is set anew each charging year, and the element that varies with when a site draws power is the one solar generation and battery storage can bring down.

For an energy manager, TNUoS sits next to DUoS on the bill. The two are often confused, because both are network charges passed on by the supplier rather than set by it. TNUoS covers the national transmission network; DUoS covers the local distribution network that carries power the last part of the way to a site.

Who sets TNUoS charges?

The transmission network is owned by a small number of transmission owners across the country, and the charges that recover the cost of building and maintaining it are administered by the National Energy System Operator, NESO. They are published each year in the charging statement NESO issues, and they reach a site through its electricity supplier, which collects them alongside the cost of the energy itself. Ofgem regulates the methodology behind them.

Because the rates are set nationally and revised each year, the figure a site pays moves from one charging year to the next even when nothing about the site changes. The current charging statement is the authority for the rates in force.

How is TNUoS charged for a large site?

For a large half-hourly site, the TNUoS demand charge has two parts.

The first is a fixed charge, set by the site's agreed capacity and the voltage at which it connects. Under Ofgem's Targeted Charging Review, the residual part of TNUoS moved to fixed capacity-based bands from April 2023, the start of the 2023/24 charging year, so it no longer changes with how or when a site uses power. The rule is set out in Ofgem's Targeted Charging Review: Decision and Impact Assessment (November 2019) and applied in the annual NESO TNUoS charging statement. A site pays the band it falls into whatever its behaviour, and the only way to move it is to change the band, usually by reviewing the site's agreed import capacity.

The second is a forward-looking charge that reflects how much a site draws from the transmission network during the peak-demand periods NESO sets for the charging year. A site's charge for this element depends on its metered demand during those periods, and the tariff varies by transmission zone, so the same peak demand costs materially more in some regions than in others; in a few far-northern zones it is a credit rather than a charge. These periods have long been the three winter Triads, the half-hour settlement periods of highest national transmission demand between November and February. NESO has been reforming the demand methodology, so the current NESO TNUoS charging statement, linked above, is the definitive source for how the peak-demand periods are defined and priced in the year in force.

How can a large site cut its TNUoS charges?

The fixed element responds only to a change in the capacity band, so the room to act on behaviour sits in the forward-looking element. Because that element depends on demand during the peak periods on the transmission network, across most of the country a site that draws less power at those times pays less, without necessarily using any less electricity across the year.

This is where on-site solar generation and battery storage change the figure. A battery charged at other times and discharged through a peak period reduces the grid import that would otherwise be metered then, and solar reduces import directly whenever it is generating. Because the peak periods fall on winter weekday afternoons and early evenings, when solar output is low, most of the TNUoS saving comes from the battery, with solar contributing more to other parts of the bill.

How closely a site must target individual half-hours depends on how NESO defines the peak-demand periods for the charging year, which the charging statement sets out. A site that reduces its grid import across the likely winter peak windows, rather than trying to hit single settlement periods, captures the saving without depending on any one year's definition holding into the next.

Lupa models that effect against a site's own half-hourly data, and the platform sets out how much each combination of solar and storage saves on TNUoS across the year, alongside the saving on DUoS and on capacity charges.