What are DUoS Charges and How They Affect Your Business | EnergyMarketPrice

What are DUoS Charges and How They Affect Your Business

29/03/2017 09:10 Electricity Market

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DUoS (Distribution Use of System) charges are levied by the UK’s regional DNO (Distribution Network Operator) and have a massive impact on how much a company spends on electricity. These 3rd party costs support the maintenance, development, and operation of the UK’s electricity distribution networks.

 

For Half-Hourly metered customers, DUoS charges are currently split into three separate time-based charging structures and operate on a traffic light system — red, amber and green. Charges are highest during the red zone and are significantly lower than this during the green zone.

 

The breakdown is as follows:

 

1) Red: Peak time, highest demand. The most expensive time to draw power down from the grid. Typically from 16:00 to 19:00, Monday to Friday, including bank holidays.

 

2) Amber: Daytime charges, typically from 07:30 to 16:00 and from 19:00 to 21:00, Monday to Friday, including bank holidays.

 

3) Green: Night time charges, lowest demand. Typically from 00:00 to 07:30 and from 21:00 to 24:00, Monday to Friday, including bank holidays, and all day Saturday and Sunday.

 

Unlike some other elements of an energy contract, these are non-negotiable charges agreed and regulated by the local DNO (Distribution Network Operator).

 

However, this doesn’t mean that you can’t do anything about it. 

 

As you probably know already, the best way to reduce the costs of some of these charges is through on-site generation and energy saving technology. These require an initial investment in the short term, but the returns on it are much greater in the long term.

 

Alternatively, if you’re looking for an efficient way to make almost immediate savings with the lowest possible financial investment, you can do so by reducing or managing load times more effectively.

 

Traditionally, that’s called load shifting.

 

Basically, if you can shift consumption from the red zone into the amber or, preferably, green zones, this will result in lower unit charges. Simply put, load shifting is about using less power during the most expensive red band periods.

 

And even though this might all sound common sense, this is not always common practice. In fact, you’d be surprised to know that very few energy users are actually aware of this cost saving opportunities. 

 

But there’s more to the story. . .

 

With the introduction of the DCP228 legislation which introduces new DUoS charges, this might be all set to change.


DCP228 Changes to DUoS Charges

 

New charges associated with the DCP228 legislation come into effect from 1st April 2018.

 

For customers with Half Hourly meters, the unit charges during the Red band period will fall, while the charges during the Amber and Green band periods will rise. (Please see the pictures below)
 

 

DUOS RED CHARGES OCT 2017 — MAR 2021 FORECAST

 

DUOS AMBER CHARGES OCT 2017 — MAR 2021 FORECAST

 

DUOS GREEN CHARGES OCT 2017 — MAR 2021 FORECAST

 
So What Does This Mean for Your Business?

 

Firstly, if you've been working hard to shift demand from Red time bands to Amber or Green, you'll now have less of an incentive to keep those changes. As Red units will cost less and Amber & Green units will cost more, the incentive for shifting demand is reduced.

 

Secondly, if you aren't reliant on peak demand, and have instead used electricity during Amber and Green times, you may now see a significant cost increase.

 

How to bring clarity and transparency into your business

 

If you'd like to learn how EnergyMarketPrice can help you deal with the complexity of calculating non-commodity costs without having to rely on multiple systems and spreadsheets, we're here to help.

 

Just sign up for a free personalized demo of our solutions tailored to your needs from one of our experts. It's simple and takes less than 2 minutes:


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