Third party charges

On your electricity invoice, you’ll see a section labelled ‘other charges’. This includes any elements of your contract which are ‘passed through’. A 'pass through' charge is one that is levied by a third party (e.g. the Government), which we have to pass on to you - our customer.

Some of the charges you may find in the ‘other charges’ section of your invoice include the third party costs for the investment in future and continuing electricity generation - such as Renewables Obligation (RO) Charge, Feed in Tariff (FiT) Charge, EMR Contracts for Difference (CfD) Payments and EMR Capacity Market (CM) Charges.

There are also the third party costs for the delivery of electricity and these are Distribution Use of System (DUoS), Balancing Services Use of System (BSUoS) and Transmission Network Use of System (TNUoS).

To help you understand the ‘pass through’ third party costs we have produced PDFs for you to download. Please click on the Find out more link.


man and woman in office reading a doc - E.ONElectricity Market Reform

Recovering costs to ensure payments for low carbon generation as part of CfD and payments to ensure generation is available at peak usage times as part of the CM.

Find out more

wind power station Askam wind farm blue sky - E.ON

The Renewables Obligation

Introduced by the Government to support large-scale renewable electricity generation in the UK.

Find out more 

Mani on roof with solar panelsThe Feed-in Tariff 

Paying homes and businesses for electricity produced as well as electricity exported to the grid.

Find out more

power linesDistribution Use of System

Recovering the cost of distributing electricity across the national network.

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women on phone at a desk E.ONBalancing Services Use of System

Recovering the cost of balancing supply and demand across the national electricity network.

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cranbrook energy centre - E.ONTransmission Network Use of System

Recovering the cost of running and maintaining the National Grid.

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Further information

Electricity Market Reform (EMR)
In summer 2014 new legislation came in to force which introduced new costs in to the electricity market, through a package of measures known as Electricity Market Reform (EMR). It has been designed to encourage new investment in low carbon generation and in the provision of generation capacity for peak usage times. Through EMR, two key mechanisms were introduced - Contracts for Difference (CfD) and Capacity Market (CM). 

CfD provides top up payments to generators to ensure they receive a guaranteed price for the power they produce, which is managed by the Low Carbon Contracts Company (LCCC). For more information visit

The CM provides ongoing payments to generators to ensure there is sufficient reliable capacity during peak usage – this is managed by the Electricity Settlements Company. The LCCC and the Electricity Settlements Company are independent companies set up by the government. For more information about the Electricity Settlements Company visit

EMR costs have not been included in any contracts agreed on or before 31 July 2014. For contracts agreed from 1 August 2014 we’ll have included estimates of EMR costs on all new quotes which run past 1 April 2015. 

Read more about EMR costs or for further information about EMR please visit

The Renewables Obligation (RO) is a mechanism designed to support large-scale renewable electricity generation. Through the RO, the Government places an obligation on all licensed electricity suppliers to source a proportion of the electricity we supply to customers from renewable energy sources. As the UK is generating much more renewable energy than ever before, the level of supplier obligation and consequently the cost to you - as our customer - has also increased.

Read our FAQs guide about The Renewable Obligation or visit

In April 2010, the Government launched the Feed-in Tariff (FiT) scheme to encourage homes and businesses to generate their own renewable, low carbon electricity using solar photovoltaic (PV) panels, wind turbines or other renewable technologies. The FiT scheme pays registered generators for every kilowatt of electricity produced and for any electricity exported to the grid. FiT accredited generators are registered with Ofgem by their energy supplier (i.e., us) in order to receive generation and export payments. Ofgem ensures all suppliers only pay out their portion of FiTs, based on their share of the energy supply market. There has been a significant increase in the uptake of solar PV installation in the UK over the past few years, meaning that more FiT qualifying electricity is generated and therefore a rise in the number of payments needed to be paid

View our FAQs guide about the Feed-in Tariff or visit 

When the system can’t transmit the power generated at a particular location to where there’s a demand for it, National Grid will reconfigure the system. They may increase or lower the amount of electricity being supplied to the system at different locations. The costs incurred are known as constraint costs and are passed on equally to generators and suppliers as the Balancing Services Use of System (BSUoS) charge.

To find out more visit

Distribution Use of System
Electricity is distributed around the UK by Distribution Network Operators (DNOs), licensed by Ofgem. They own and run the distribution network of pylons and cables that carry electricity from the national transmission network (owned and managed by National Grid) to homes and businesses. DNOs don’t sell electricity, they only distribute it.

Transmission Network Use of System (TNUoS) charge recovers the cost of running and maintaining the National Grid. Providing a reliable source of electricity needs a reliable transmission network, to connect power stations to distribution networks across the country.

To find out more visit

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Our dedicated team is here to help, whatever your business needs. Call 02476 42 42 42 (select option 3 for Corporates)

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