Ensuring a smooth supply of electricity is crucial for your business operations. However, transmitting electricity across the National Grid incurs significant costs that can account for up to 16% of your electricity bill. One way businesses aimed to avoid high transmission charges was by adopting a flexible approach to their energy management. Commonly known as "triad avoidance" this process involves reducing energy usage during specific times when national demand may be high, in order to minimise costs.
Following a review of the Triad avoidance process, Ofgem decided they needed to fairly allocate transmission charges. Ofgem introduced the Targeted Charging Review (TCR), which turned these charges into a fixed cost instead of a variable one. Ofgem therefore divided the Distribution Use of Service (DUoS) charges into bands 1-4, effective from April 2022, and followed it up with the banding of Transmission Use of Service (TNUoS) charges a year later in April 2023. Your business's band is determined by your available supply capacity (ASC) – the higher the band, the higher the fixed charges.
On your bill, you can expect to see these charges under the headings
Distribution fixed charge…
Transmission fixed charge…
Bands are structured from 1-4 with one being the lowest and four being the highest.
While there is no way to completely eliminate charges as a result of TCR, Brownlow can check that your charging is correct. We can help you optimise your costs and processes according to current industry standards using our in-house energy experience and intelligence, optimising your forward costs where possible.
To reduce the impact of these costs on your energy spend, Book a Call today
Triads explained (pdf)
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