What is a non-commodity electricity charge?
A non-commodity charge recovers costs other than the wholesale electricity itself, such as network and environmental costs [S1]. Ofgem's 2019 charging decision put residual network costs onto fixed charges [S3]. Your business therefore needs to distinguish usage-related costs from fixed amounts before modelling solar, batteries or changed charging hours. Checked October 2026.
What are non-commodity charges on your electricity bill?
A non-commodity electricity charge covers a cost other than buying the wholesale electricity itself. Network and environmental costs are examples [S1]. Why it matters for your site: reducing imported electricity does not automatically reduce every part of your invoice.
The commodity element concerns the energy purchased. Other elements support delivery and policy obligations. Ofgem describes wholesale, network and environmental costs in business pricing [S1]. The business electricity bill guide explains the invoice lines; this term describes the wider cost category.
Which non-commodity charges are fixed?
Separate a fixed charging basis from a price fixed for your contract term. A daily item can remain payable when consumption falls, while its rate may change under the agreement. Ofgem describes business costs being allocated between unit rates, standing charges and pass-through items [S2].
| Cost type | What to establish |
|---|---|
| Usage-related | Quantity and rate applied to imported energy |
| Fixed residual network | Applicable fixed amount and charging band |
| Transmission | How the supplier recovers its transmission costs |
Ofgem’s Targeted Charging Review decision puts residual network costs onto fixed charges [S3]. NESO explains that transmission charges recover installation and maintenance of the transmission system [S4]. Neither statement gives you a universal retail price for your premises.
How should you use the distinction in a site assessment?
For an illustration, not a quote, assume imports fall by 1,000 kilowatt-hours (kWh), a measure of energy. If a usage-related charge is assumed at £0.02/kWh, its reduction is 1,000 × £0.02 = £20. An assumed £60 fixed charge remains £60. These are calculation assumptions, not current prices.
Read standing charges and use business electricity price data for context. Request a bill model that shows each charge’s basis before attributing any reduction to solar or batteries.
Next step
Visit cut energy costs and get matched with an installer that covers your area.
Piggy Pineapple Ltd operates this referral service. We refer enquiries to installer partners and may be paid a fee. Our owner holds shares in at least one partner. Before sharing details, we name the proposed partner and disclose any shareholding in it.
Common questions
Does non-commodity mean a tax?
No. Ofgem distinguishes network and environmental costs within business pricing. A network-cost item is not simply another name for a tax [S1].
What does TNUoS pay for?
Transmission Network Use of System charges recover the cost of installing and maintaining the transmission system. NESO publishes the underlying charging information [S4].
Are metering costs part of the wholesale energy price?
Metering is a separate cost of serving your site. Ofgem notes that business standing charges usually recover fixed costs including metering and certain network costs [S2].
Does shifting consumption remove residual network charges?
Ofgem's Targeted Charging Review decision uses fixed residual charges. Do not model these as disappearing merely because consumption moves to a different hour [S3].
Must every network cost be a separate invoice line?
No. Business suppliers can recover costs through a mixture of standing charges and unit rates. Ask for the contract's breakdown before adding a separate amount [S2].
Ask about your site
Sources
- Managing business energy costs in an uncertain market, Ofgem,Last checked 19 October 2026
- Standing Charges - Call for Input, Ofgem,Last checked 19 October 2026
- Targeted Charging Review - Decision and Impact Assessment, Ofgem,Last checked 19 October 2026
- Transmission Network Use of System Charges, National Energy System Operator,Last checked 19 October 2026