Electricity Distribution Charges (DUoS)
A Distribution Network Operator (DNO) is licenced to distribute electricity from the National Grid to your metering point via their local network. As of 1st April 2018, all DNOs made a significant change to the way they recover charges for maintaining an electricity connection to your property.
Distribution Use of System (DUoS) forms part of the non-commodity cost element within the overall contract price that you pay for electricity. Historically, these charges had been weighted to ensure that consumers who use more at peak times paid more.
With the increased focus on energy efficiency and incentives for businesses to be aware of their consumption profile and aim to use less during peak periods, the revenue that DNOs collect via DUoS charges had reduced. To counter this, they have changed the weighting of charges across the various charging periods to ensure sufficient revenue to maintain their networks.
Taking the Distribution Area (DNO 14) as an example:
For some consumers, this change - referred to as DCP228 – results in an increase in costs and for others, a slight reduction. As for the direct financial impact, it depends on which distribution area you are in and how much energy you use in each of these time bands over a typical year (your supply profile).
Profile A (grey) has a consistent load throughout the day and is likely to see a minimal change.
Profile B (white) peaks during the day but falls out of hours and is likely to see an increase, driven by the change in charges during the Amber and Green time periods.
If you would like us to calculate the financial impact on your business as a result of changes to Electricity Distribution Charges, please get in touch.