Electricity costs for businesses set to double in 2026

Most UK businesses are expected to see a sharp increase in energy costs in 2026. This is due to a change in Transmission Network Use of System (TNUoS) charges, which will increase by £3.7billion to cover the cost of essential grid maintenance – a change of around 94%.

TNUoS is the bill charged to energy suppliers that’s intended to cover the cost of maintaining the high-voltage transmission network – i.e. all the pylons and cables that move electricity around the UK. However, this cost is usually passed down to customers in the form of higher energy bills, and for businesses it’s usually added to standing charges.

Almost every UK business with an electricity supply will be affected by this price change, and because TNUoS residuals are charged per site and per day, SME businesses with multiple sites and meters - like those in the hospitality sector - may see larger, compounded increases to their energy costs.

These charges are expected to continue to rise by mor than 10% per year until 2031.

The TNUoS isn’t the only thing affecting energy costs in 2026. The UK government is also adding a levy to all electricity bills starting from November 2025 to fund the Nuclear Regulated Asset Base (RAB) scheme. This addition to electricity bills is expected to cover the cost of new nuclear power projects.

These charges are expected to impact domestic energy bills by £1 per month, but charges apply at a rate of £3.46/MWh and will have a greater impact on businesses based on their consumption. These charges will also be rising to £3.93/MWh from 1 January 2026.

While small and medium British businesses will be hit hard with these price changes, many of the UK’s largest energy consumers will dodge the rise.

Around 500 of the UK’s biggest, energy-intensive manufacturers, many currently benefitting from a 60 per cent discount on network charges will, will not have their energy prices increase.

Instead, their government-backed discounts will rise to 90 per cent next year – a decision that has been met with criticism from many smaller firms who are already feeling the pressure.

Kara Gammell
Personal Finance & Insurance Expert

Budget ahead and rethink your contract to minimise the impact

Planning for these price changes starts with breaking down your current bills and finding how much of your energy costs comes from TNUoS charges. Even if you currently have a fixed contract, it is still possible for your bills to increase due to most contracts treating TNUoS as a ‘pass-through’ charge.

On the other hand, fixed cost energy contracts aren’t likely to be affects by RAB charges, so it’s still worth considering if you’re planning to switch your business energy provider.