Distribution Use of System charges

Distribution Use of System charges

Businesses who possess a Half-hourly (HH) electricity meter may often find various charges on their bill.

Businesses who possess a Half-hourly (HH) electricity meter may often find various charges on their bill.

What is a Distribution Use of Systems (DUoS) charge?

The fourteen local Distribution Networks (owned by six Distribution Network Operators – DNOs) take power from the National Grid and distribute it to end users. DNOs charge suppliers under published tariffs for distribution use-of-system (DUoS) which the suppliers aim to recover from their customers.

For existing HH settlement customers the trend has been to bundle these charges into contract rates, but large users still have the option to show them separately and on a pass-through basis if preferred. However, with the enforcement of P272 which affects consumers with “Max Demand” meters, there is an increasing level of confusion in the market with each supplier potentially handling the switch to HH settlement differently. In some cases the charges are bundled in, with others they are separate.

With regard to certain specific charges, there are often ways to mitigate increased costs with some simple changes. For example, DUoS charges can be significantly reduced if a site can reduce load or switch on generators at peak times.

What charges does Distribution Use of Systems (DUoS) consist of?

  • The availability/capacity supply charge
  • Excess availability charge (applicable only if the agreed supply capacity is exceeded)
  • Reactive power
  • Standing charge
  • Unit rates – there are three time band periods in which these rates are split into; Red, Amber and Green. Energy suppliers use the time banding that are created by the regional distribution companies, these are different depending upon the company supplying that region but tend to be around the evening on weekdays: e.g. SWALEC red band is 1700 to 1930 hours weekdays.

Please see the chart below for the applicable time bands for each company where you may occur peak demand charges.

Distribution of System Charges chart - from Utilitywise

Do you have an electricity meter in the 05-08 profile class? Then your electricity bill is going to get 17,519 times more complicated. P272 is the industry name of the mandatory regulatory change for meters in classes 05-08. From 1 April 2017, these meters will be billed in a new way and some meters may also need to be physically changed. It’s estimated that P272 affects up to 160,000 meters in the UK.

While the change will mean your bill will more accurately reflect your actual usage, if you use power during times of peak demand you may find you end up being charged more.

Utilitywise will help you understand the impact of P272 on your business and our services can help put you back in control.

Click here to find out more on P272


Posted by on Tuesday, the 15. December at 11.51

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