Unfortunately, electricity doesn’t just arrive by magic. Included in your business electricity bill is the cost of physically transporting your electricity from its source. Plus, the further away your company is based from where the energy is generated, the more it costs to transport.
The difference between distribution and transmission charges can be explained through roads. Transmission charges are the national motorway network for energy, whereas distribution costs are the smaller A or B roads that carry the energy to its specific destination.
There are specific costs within this section, including:
• Pass through charges: these fees are paid to other companies who operate and maintain the electricity network. For domestic customers, these fees are combined into one single standing charge, but for businesses, they are separated. All energy suppliers apply pass through charges to business electricity bills, but the amounts may vary.
• Transmission Network Use of System (TNUoS): transmission charges are associated with transmitting electricity from a power station to the grid supply points through the high voltage transmission network.
• Distribution Use of System (DUoS): the DUoS cover the cost of distributing electricity to business premises and is applied by regional utilities who manage the distribution network.
• Balancing Services Use of System (BSUoS):these costs are associated with the everyday operation of the transmission system, which helps to balance the grid.