Every business’s electricity costs include a contribution to funding the balancing of supply and demand on the British electricity grid – it’s called the Balancing Services Use of System (BSUoS) charge.
This charge already adds around £14 for each megawatt hour (MWh) consumed in the 2026/27 year. But it’s set to increase significantly – not just in years to come, but by an extra £5–6/MWh on top of this year’s costs. For a business consuming 5 gigawatts (GW) a year, that could mean an unexpected additional liability of £30,000.
So what exactly does this charge cover – and what’s causing the unwelcome cost escalation?
BSUoS funds the services needed to balance the grid, to ensure the lights stay on when a power station goes offline, the wind stops blowing, or demand suddenly surges – such as when 21.5 million people switched on their TVs to watch the 2026 World Cup semi-final. These balancing services span a range of measures to keep electricity flowing and prevent power outages.
Delivering BSUoS is the responsibility of the National Energy System Operator (NESO), which closely monitors and manages matching our national supply with demand on a second-by-second basis.
When supply looks like it’s going to be insufficient to meet demand, NESO can instigate energy balancing actions such as switching on fast-supply power sources – for example from batteries or pumped-storage hydro. It will also keep fossil-fired power stations on standby to ramp up generation as needed.
In addition, it will have contracts with large businesses to pay them to reduce consumption when asked – for example by pausing energy-intensive processes or switching to on-site generation rather than drawing electricity from the grid.
However, as we move towards a clean power era with increasing volumes from decentralised renewable sources, the larger share of the BSUoS budget is spent on what’s called ‘constraint costs’. These include paying generation sources to stop generating so as not to swamp the grid with more power than it can manage.
BSUoS costs are under increasing scrutiny because the more wind power we build, the higher the BSUoS charge becomes, as this video explains.
There are both short-term and long-term reasons for this – and we’ll explore both.
Since 2023, BSUoS charges have been fixed in advance to provide budget certainty. But this year, it looks like additional costs will be added on top of existing pre-agreed rates, as this video explains.
Like many network charges, BSUoS charges are set to become more expensive as we transition to a clean power network. But why is this happening – and what do synchronising network upgrades have to do with it?
Longer term, the aim is to equip the UK with a more resilient, sustainable energy system that isn’t at the mercy of the price of gas, ultimately delivering cheaper prices for all. But there is some way to go before that vision is realised.
One of the growth areas of balancing services is procuring more flexibility around energy use from consumers – and businesses are especially well placed to participate in these schemes and earn money from doing so. You can gain deeper insight into this in our forthcoming podcast – see details below.
In summary, NESO’s balancing charges are becoming a significant and increasingly unpredictable cost factor that businesses cannot afford to ignore.
Why does this matter?
Businesses are already paying £13.74/MWh for BSUoS charges in 2026/27
BSUoS is no longer a modest network charge. Rising balancing and constraint costs mean it is becoming a major source of electricity cost inflation and budget uncertainty for businesses, both now and over the coming years.
Our forthcoming podcast explores many of the issues surrounding both wholesale commodity and non-commodity costs in more detail – as well as how embracing energy flexibility can help you reduce the financial impact of rising costs. So keep an eye out for this via our LinkedIn feed.