Ofgem publication indicates huge increases in future Electricity Transmission Costs

The figures put forward in Ofgem’s ‘Draft Determination’ last month suggest that the permitted revenues for Transmission Owners in 2026-27 will be 82% higher than those in 2025-26.

This is also 50% higher than the NESO (National Energy System Operator) indicated Transmission costs might be in its Initial View of Draft Tariffs for 2026-27.

Given that those initial Draft Tariffs were forecasting an average increase of 25% in consumer standing charges, Ofgem’s latest statement suggests that customers are likely to incur substantial increases, above the already high expectations.

How electricity suppliers elect to pass these costs on to their customers remains to be seen, but businesses should be mindful of both the fixed costs being quoted, and whether their supplier’s terms allow them to pass on any future increases.

At present, Ofgem’s proposal remains a draft that is under consultation, with Final Determinations to be published later this year. To read the full document, and for details of how to participate in the consultation, visit www.ofgem.gov.uk