DNO โ Distribution Network Operators
Distribution Network Operators (โDNOsโ) are a key component of the United Kingdom (UK) mainland energy system. The UK electricity system is made up of the transmission network (run by National Grid โ National Energy System Operator - NESO) and the distribution network.
There are fourteen (14) licensed distribution network operators (DNOs) within the UK mainland, and each is responsible for a regional distribution service area.
Of these fourteen (14) DNOs, they are currently owned by six (6) different parent groups.
DNO Groups & Regional Distribution Service Area
- Scottish & Southern Energy (17 Scottish Hydro Electric Power Distribution plc โ Scottish Hydro & 20 Southern Electric Power Distribution plc โ Southern).
- Northern Power Grid (15 Northern Powergrid (Northeast) Ltd - Northern Electric & 23 Northern Powergrid (Yorkshire) plc - Yorkshire).
- Scottish Power (SP) Energy Networks (18 SP Distribution Ltd - Scottish Power & 13 SP Manweb plc).
- UK Power Networks (10 Eastern Power Networks plc โ Eastern, 12 London Power Networks plc โ London, & 19 South Eastern Power Networks plc โ Seeboard).
- National Grid (Formerly Western Power Distribution) (11 National Grid Electricity Distribution (East Midlands), 14 National Grid Electricity Distribution (West Midlands), 21 National Grid Electricity Distribution (South Wales) & 11 National Grid Electricity Distribution (South East)).
- Electricity North West (16 Electricity North West โ Norweb).
What are Distribution Use of System (DUoS) Charges?
DUoS, or Distribution Use of System charges, are a major cost component of electricity invoices and are incorporated to recover the cost incurred by the various Distribution Network Operators in transmitting electricity from the local sub-station to a consumerโs electricity meter.
DUoS charges are recovered through the following pricing structure:
- Standing Charges - collected per meter per day.
- Capacity Charges - collected per kVA per day.
- Unit Rates - collected per kWh of consumption recorded by the electricity meter.
- Consumption is split into Red, Amber and Green bands, each with differing (reducing) rates.
- DNOs define the time periods differently; the bands are as follows:
- Red โ peak period of demand (typically weekday afternoons)
- Amber โ non-peak day rates (traditionally referred to as โshoulderโ periods)
- Green โ night and early morning consumption (low network demand)
Some Examples of DNOโs Red, Amber & Green time periods:
| DNO | Band | Weekday | Weekend |
|---|---|---|---|
| 15. North East | Red | 16:00 - 19:30 | |
| Amber | 08:00 - 16:00 & 19:30 - 22:00 | ||
| Green | 00:00 - 08:00 & 22:00 - 24:00 | All day | |
| 20. Southern Electric | Red | 16:30 - 19:00 | |
| Amber | 09:00 - 16:30 & 19:00 - 20:30 | ||
| Green | 00:00 - 09:00 & 20:30 - 24:00 | All day | |
| 10. Eastern | Red | 16:00 - 19:00 | |
| Amber | 07:00 - 16:00 & 19:00 - 23:00 | ||
| Green | 00:00 - 07:00 & 23:00 - 24:00 | All day |
DUoS charges account for a large portion (approximately 10%) of a typical electricity invoice, and any change will have a financial impact on affected consumers.
NUS details below the latest outline of the proposed changes to DUoS over the next couple of years.
DUoS - 2025-2026
The 2025-2026 period is the first in which Ofgemโs Access Significant Code Review (SCR) came into effect. The main consequence of the SCRโs was a complete rebalancing of the components making up the overall DUoS charge. Previously, DUoS costs were largely recovered through fixed standing charges (specific to each meter profile).
The percentage changes are highly variable, depending on meter profile and the distribution network. However, as an example, a trend can be illustrated by selecting a typical low voltage โBand 2โ meter as our benchmark. Across the various DNO regions, the standing charges for these meters saw an average 72% reduction vs the 2024/2025 charges, with some regions implementing a 100% reduction i.e. an elimination of standing charges entirely.
To compensate, on average, capacity charges more than doubled, with the most significant rise (being more than three (3) times the previous yearโs levels) seen in 15 Northern Powergrid (Northeast) region. Likewise, unit rates will also increase by around 30% on average. The exceptions are the 12 London Power Networks and 20 Southern Electric Power regions, which have seen a drop in unit rates by ~44% and ~23%, respectively.
DUoS - 2026-2027
The changes in DUoS set for implementation in April 2026 are of a slightly more nuanced nature. Whilst average UK DUoS charges essentially show no change - rising by less than 0.5% or roughly ยฃ30 annually for our โtypicalโ low-voltage site-specific meter โ the variation in charges from region-to-region is significant.
Fixed DUoS charges: fixed charges exhibit this inconsistency across the board. Most notably, 14 Eastern Power Networks meters will see a circa 140% rise, while all 16 Electricity North West, 17 Scottish Power Distribution and 20 Southern Electric Power will have their fixed charges set to ยฃ0 (Southern had already adopted this for some of its meters in April 2025).
Capacity Charges: Whilst these will, for the most part, remain stable, 12 London Power Networks, 20 Southern Electric Power, and 16 Electricity North West regions will see significant changes of +104%, +32% and -17% respectively.
Unit Red, Green, Amber (RAG) Rates: Green rates will decrease - almost universally โ by around 20% on average. Amber will also reduce, particularly for 16 Electricity North West meters. However, Red rates will show significant increases in the following regions:
- 23 Northern Powergrid (Yorkshire): ~30%
- 15 Northern Powergrid (Northeast): ~20%
- 20 Southern Electric Power Distribution: ~18%
- 10 Eastern Power Networks: ~17%
12 London Power Networks: Sees the largest climb, this region will face a circa 60% rise in average DUoS overall, driven by a virtual doubling of capacity charges. Interestingly, fixed charges will fall, but not nearly enough to offset the rise in capacity rates.
16 Electricity North West: Conversely, this region sees the biggest drop in overall DUoS, reducing by around 40%. This results from fixed costs being reduced to zero, along with the aforementioned cut to both green and amber band unit costs.
Conclusion
April 2025 brought sweeping changes to the way DUoS is recovered, entirely shifting the balance from fixed charges to capacity-based charges. A consumerโs DUoS costs are now based on the level of Demand and offtake rather than the number of meter points and class of meter.
As outlined above, April 2026โs changes will vary widely depending on the region. Customers in 16 Electricity North West will clearly be the biggest beneficiaries, with their large cuts to their annual DUoS charge. The exact opposite is true for those consumers in the 12 London Power Networks region.
Trends have emerged, however, from this mixed bag. The increasing emphasis on DUoS capacity charges means kVA management is more important than ever, with customers running meters with excessively high capacities being disproportionately charged. The freefall of standing charges has the clear effect of reducing the strain on customers with large meter portfolios.
Finally, the lowering of amber and green rates whilst simultaneously increasing red rates incentivises a proactive approach to load management โ i.e. load shifting in order to avoid peak demand and high network stress periods.
Our clients are encouraged to investigate the specific changes affecting the regions they operate in. If you are an organisation that would like to understand how NUS can support in optimising your non-commodity charges, please contact us.