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Business energy changes in April 2027: what goes up and what comes down

By the Business Savings Guru team. Last updated 28 October 2026.

On this page
  1. The short answer
  2. Key facts
  3. Renewables Obligation: the main reduction
  4. Balancing charges (BSUoS): a large draft rise
  5. Transmission charges (TNUoS): forecast rises for most bands
  6. Distribution charges (DUoS): published, but site-specific
  7. Other levies, CCL and water
  8. For multi-site businesses
  9. Worked example: a five-site portfolio
  10. How Business Savings Guru helps
  11. Frequently asked questions
  12. Sources

The short answer

From 1 April 2027 the Renewables Obligation on business electricity falls from 0.472 to 0.369 certificates per MWh (or 0.394 if BICS legislation is in force), while the Climate Change Levy rises from 0.801p to 0.827p per kWh. NESO's draft balancing charge for April to September 2027 is £21.67/MWh, 58% above the current £13.74/MWh, and its October 2026 forecast puts many fixed transmission charges 13% to 50% higher. For many sites, the rises in network and balancing charges are larger than the RO reduction.

Key facts

ChargeDirection from April 2027SizeStatusSource
Renewables Obligation (RO)Down0.472 to 0.369 ROCs/MWh (minus 22%), or 0.394 (minus 17%) if BICS is in forcePublishedDESNZ, 25 September 2026
Climate Change Levy (CCL)Up0.801p to 0.827p/kWh for electricity and gas (plus 3.2%); LPG frozen at 2.175p/kgConfirmedHMRC CCL rates page
BSUoS (balancing)Up£13.74 to £21.67/MWh (April to September); £12.49 to £18.42/MWh (October to March)Draft; final due December 2026NESO, 21 September 2026
TNUoS (transmission, fixed residual)Up for most bandsFor example HV band 2: £117.15 to £167.71 per site per day (plus 43%)Forecast; draft due November 2026, final by end of January 2027NESO, 14 October 2026 forecast
DUoS (distribution)Mostly up, varies by regionLarge rises in fixed charges in many regionsPublished by DNOs; summary figures are reportedDNO charging statements; Drax analysis, January 2026
CfD levySet quarterlyQ4 2026 £5.529/MWh; Q1 2027 £2.979/MWh; April 2027 rate not yet setConfirmed to March 2027EMR Settlement
BICS (eligible manufacturers)DownAround £35 to £40/MWh; RO and FiT from April 2027, CM from October 2027Scheme open; exemptions depend on legislationDBT, 15 April 2026; GOV.UK guidance
Water wholesale (England, example)Up, smallThames Water indicative: plus 0.5% water, plus 2.6% wastewater, plus 1.3% dualIndicative; finals January 2027Thames Water, 13 October 2026

Renewables Obligation: the main reduction

The RO is a policy cost that suppliers pay for each MWh they supply and pass on to business customers. DESNZ published the 2027 to 2028 obligation on 25 September 2026: 0.369 ROCs per MWh in Great Britain, down from 0.472 in 2026 to 2027. If the legislation for the British Industrial Competitiveness Scheme (BICS) is in force in time for a revised level to be confirmed before 1 April 2027, the level will instead be 0.394, because exempting eligible manufacturers spreads the cost over fewer MWh.

The pound value depends on the buy-out price. Ofgem set the 2026 to 2027 price at £69.34 per ROC, and it is now indexed to CPI. Ofgem normally publishes the next price around the end of March.

At the 2026 to 2027 price, the RO falls from £32.73/MWh to £25.59/MWh (0.369 level) or £27.32/MWh (0.394 level). That is a reduction of £7.14 or £5.41 per MWh. The real 2027 to 2028 figures will be slightly higher once the new buy-out price is set.

Balancing charges (BSUoS): a large draft rise

BSUoS recovers the cost of balancing the electricity system. NESO now sets fixed BSUoS tariffs in six-month blocks. The current tariffs are £13.74/MWh (April to September 2026) and £12.49/MWh (October 2026 to March 2027).

NESO published draft tariffs for 2027 to 2028 on 21 September 2026:

  • Draft Tariff 9, April to September 2027: £21.67/MWh (plus £7.93, or 58%)
  • Draft Tariff 10, October 2027 to March 2028: £18.42/MWh (plus £5.93, or 48%)

NESO gives two reasons. First, it forecasts a cumulative under-recovery of £1,062 million by the end of Tariff 8, spread equally across the two draft tariffs. Second, forecast balancing costs are higher because of higher wholesale price assumptions.

These are draft figures. NESO will publish final Tariffs 9 and 10 in December 2026. Until then, budget with a range rather than a single number.

Transmission charges (TNUoS): forecast rises for most bands

Most non-domestic sites pay a fixed TNUoS "demand residual" charge in pounds per site per day, set by voltage and size band. In 2026 to 2027 these charges rose sharply. For example, NESO's final tariffs put HV band 2 at £117.15 per site per day.

NESO's October 2026 forecast for 2027 to 2028 shows further rises for most business bands. Comparing the forecast with 2026 to 2027 final tariffs:

Band2026 to 2027 final (£/site/day)2027 to 2028 forecast (£/site/day)Change
LV15.806.79plus 17%
LV438.1852.49plus 38%
HV131.8435.98plus 13%
HV2117.15167.71plus 43%
HV4528.91791.19plus 50%
EHV1325.48438.79plus 35%

NESO states that its forecasts may not match final tariffs. The draft forecast is due in November 2026 and final tariffs by the end of January 2027. Note that 2027 to 2028 has 366 days, because it includes 29 February 2028.

Distribution charges (DUoS): published, but site-specific

DUoS pays for the local distribution network. Each of the 14 distribution regions sets its own charges, which include unit rates by time band (red, amber, green), a fixed daily charge and, for larger sites, a capacity charge per kVA.

Most network operators published their 2027 to 2028 charges in December 2025, 15 months ahead. Ofgem allowed two operators, National Grid Electricity Distribution (East and West Midlands) and SSEN (North Scotland and Southern), to publish later because of problems with the charging models, with deadlines of 31 January and 27 February 2026.

Industry analyses report large rises in fixed charges, but the figures vary by source and region. Drax reported an average rise in fixed charges of around 58% for a typical low-voltage site across the regions it had analysed, with total DUoS changes ranging from plus 3% to plus 64%. Another industry guide reports fixed charge rises of 65% to 77%. Both are reported figures, not official averages. The only reliable number for your site is the one in your network operator's charging statement for your tariff.

Other levies, CCL and water

Climate Change Levy. HMRC has confirmed main rates from 1 April 2027: 0.827p/kWh for electricity and gas (up from 0.801p), 6.468p/kg for other taxable commodities and 2.175p/kg for LPG (frozen). Climate Change Agreement holders keep their discounts: 92% on electricity and 89% on gas.

Contracts for Difference. The CfD levy is set quarterly by the Low Carbon Contracts Company. It is £5.529/MWh for October to December 2026 and £2.979/MWh for January to March 2027. The April to June 2027 rate has not been set. One industry guide reports a possible rise to about £20.67/MWh from July 2027 when a new contract for Drax biomass generation begins. Treat that as a forecast, not a confirmed rate.

Water. In England and Wales, each wholesaler publishes indicative non-household charges in October and finals in January, effective 1 April. Thames Water's indicative statement shows typical rises of 0.5% (water), 2.6% (wastewater) and 1.3% (dual service), with none above 5%. In Scotland, a new charging period for 2027 to 2033 begins on 1 April 2027.

For multi-site businesses

A multi-site business budgeting now for 2027 to 2028 should work site by site, because most of the April 2027 changes depend on each site's meter type, voltage, region and contract.

  • Check how each contract treats non-commodity costs. If they are fixed for the term, your supplier carries the change until renewal. If they are passed through, your bill moves on 1 April 2027. Many portfolios have a mix.
  • Find each site's TNUoS band on its bill or from its supplier. A site's band sets its fixed transmission charge, and the forecast changes range widely by band.
  • Use your network operator's 2027 to 2028 charging statement for DUoS, rather than an average.
  • Budget BSUoS as a range until NESO publishes final tariffs in December 2026.
  • Separate BICS-eligible sites. Eligible manufacturing sites may see the RO, FiT and CM costs removed, while other sites in the same group pay the full levies.
  • Plan renewals around the dates. Contracts priced before December 2026 (BSUoS finals) and January 2027 (TNUoS finals) will be priced on forecasts.

Worked example: a five-site portfolio

This example shows how the published and forecast changes combine. It covers only the RO, BSUoS, CCL and TNUoS residual. It excludes wholesale energy, DUoS, CfD, Capacity Market, FiT, losses, VAT and supplier margin, and assumes all costs are passed through.

Portfolio: one HV site in TNUoS band HV2 using 3,000 MWh a year, plus four LV half-hourly sites in band LV1 using 250 MWh each (1,000 MWh in total). No site is in BICS or a Climate Change Agreement. Use is split evenly between the two halves of the year.

HV site (3,000 MWh):

  • RO (0.369 level, at £69.34): (0.369 minus 0.472) × £69.34 × 3,000 = minus £21,426
  • BSUoS: (1,500 × £7.93) + (1,500 × £5.93) = plus £20,790
  • CCL: 3,000,000 kWh × £0.00026 = plus £780
  • TNUoS: (£167.71 × 366) minus (£117.15 × 365) = £61,382 minus £42,760 = plus £18,622
  • Net change: plus £18,766

Four LV sites (1,000 MWh in total):

  • RO: (0.369 minus 0.472) × £69.34 × 1,000 = minus £7,142
  • BSUoS: (500 × £7.93) + (500 × £5.93) = plus £6,930
  • CCL: 1,000,000 kWh × £0.00026 = plus £260
  • TNUoS: 4 × ((£6.79 × 366) minus (£5.80 × 365)) = 4 × (£2,485.14 minus £2,117.00) = plus £1,473
  • Net change: plus £1,521

Portfolio total: about plus £20,300 a year on these four charges. If the RO level is 0.394 instead, the RO reduction is smaller (minus £16,226 and minus £5,409) and the total is about plus £27,200.

How Business Savings Guru helps

Business Savings Guru is an independent business energy broker for SMEs and larger businesses, with particular expertise in multi-site and more complex procurement, and water and waste alongside. For April 2027, we can list every meter in your portfolio with its contract end date, TNUoS band, region and whether non-commodity costs are fixed or passed through, then show which sites are exposed to each change. Our commission is clearly disclosed on the energy contract you sign, so you know how BSG is remunerated before you commit.

Frequently asked questions

Will my business electricity bill go up in April 2027? It depends on your contract. If non-commodity costs are passed through, most sites will see higher balancing, transmission and distribution charges and a lower RO charge. If those costs are fixed in your contract, your supplier carries the change until renewal.

How much is the RO charge falling? The obligation falls from 0.472 to 0.369 ROCs/MWh, or to 0.394 if BICS legislation is in force. At the 2026 to 2027 buy-out price of £69.34, that is a fall of £7.14 or £5.41 per MWh.

Are the BSUoS and TNUoS figures final? No. The BSUoS figures are NESO drafts, with finals due in December 2026. The TNUoS figures are an October 2026 forecast, with a draft in November 2026 and finals by the end of January 2027.

What is the CCL rate from 1 April 2027? 0.827p/kWh for business electricity and gas, confirmed by HMRC. LPG stays at 2.175p/kg.

When will the April 2028 distribution charges be known? April 2028 is the first year of the new RIIO-ED3 price control. Ofgem decided on 22 October 2026 to keep the 15-month notice period for that year, so network operators are due to publish charges around the end of December 2026.

Sources

All checked 28 October 2026.