NESO has updated its forecast of electricity network charges (the costs of running and maintaining the power lines and infrastructure that transport electricity around the country) by £400 million, with total costs expected to reach £9.5 billion in 2027/28.
These are paid by electricity suppliers and generators, with some costs passed on to consumers through electricity bills.
The report, published on 14th October, looks at charges for 2027/28 to 2031/32. In NESO’s prediction, household costs have increased: the estimated annual TNUoS cost for an average household is now £103.24, which is £6.39 higher than the initial forecast for 2027/28.
Demand charges have increased as a result – the amount expected to be collected through demand residual charges has risen by £388m to £7.97bn.
Throughout the next half decade, costs are forecast to keep rising with total TNUoS revenue expected to reach £13.8bn by 2031/32.
NESO also forecasts that demand residual charges (charges that help cover the cost of running and maintaining the electricity transmission network) will rise to £7.97bn in 2027/28, up from the initial forecast – and increase to £11.66bn by 2031/32.
This matters to households since these network costs contribute to electricity bills – NESO forecasts the average household’s annual TNUoS cost will be £103.24 in 2027/28.
The higher forecast reflects updated estimates of transmission owners’ revenues, inflation and other costs passed through to electricity network users. NESO has also adjusted its forecasts to account for revenue that was not recovered through the current year’s tariffs.
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