Under P272, distribution and transmission network charges will change for affected businesses.
So what are DUoS and TNUoS, why are they so vital to cutting energy costs, and how do they relate to P272? We offer the business insider’s view on all you need to know.
DUoS stands for Distribution Use of System; it’s part of your overall electricity bill. You pay it in addition to your kWh unit charge. DUoS covers the cost of installing and maintaining local electricity distribution networks. These help distribute power to your business.
Under P272’s Half Hourly (HH) metering, your DUoS charge will be based on the volume of electricity, passed through the Distribution Network, consumed at your site.
The DUoS rates, applied to the volume of power you use, will vary depending on your region, as well as the time of day. You can identify which rates apply to you by finding your ‘Line Loss Factor’ for each site and using it to look up rates on your Distribution Network Operator’s scale of charges.
The scale and time-bandings of DUoS charges vary significantly by region, but the Red scale of charges is typically applied to the electricity used between 16:00-19:00, Monday to Friday, when the electricity system is under the most demand. This is the most expensive period for DUoS. So, if you use less electricity during this time, you will pay lower DUoS charges.
By changing the times at which you consume electricity to avoid expensive peak periods, or getting involved with demand response schemes, you can cut the amount of DUoS you will pay.
TNUoS stands for Transmission Network Use of System, and is also an electricity charge. Again, it’s part of your overall electricity bill. You pay it in addition to your kWh unit charge. It is there to pay for the cost of installing and maintaining the electricity transmission system in England, Wales, Scotland and offshore.
Some people have called the transmission system the ‘motorway’ of the electricity network. Without it, energy couldn’t get from power stations to your business. TNUoS charges have increased in recent years, as the cost of upgrading networks to accommodate more renewable generation and replace ageing infrastructure is passed though onto business’ and consumer bills.
Under P272’s HH metering, your TNUoS charge will now be calculated based on your share of demand on the transmission network during the three winter peak electricity demand periods, known as Triads.
Because TNUoS is calculated during Triads, logically enough, if you use less energy during those triad periods, you will pay a lower TNUoS charge. Triad periods occur between 1st November and 28th February each year when demand on the National Grid is at its highest.
The P272 move to HH metering means that in many cases, new DUoS and TNUoS charges will appear as items on your bill.
This might mean you end up paying more than before, conversely, you might pay less.
It pays to understand how the new charging mechanism works, and to know whether the right new DUoS and TNUoS charges have been applied to your bill.
A further complexity
DUoS and TNUoS charges are shown, paid for and contracted in many ways, depending on the type of contract you have with your energy supplier.
Inenco can help you with bill validation and making sure your DUoS and TNUoS charges are correct. We can review and challenge both current and historical charges and advise on flexibility, helping your organisation to understand how to manage load to avoid excessive costs.
But be aware that the charges and the type of DUoS and TNUoS services on offer will vary. Fundamentally, your aim should be to understand how DUoS and TNUoS work, which enables you to manage your energy usage better and reduce your costs.