Since the Targeted Charging Review (TCR) changes came into effect, many businesses across the UK have seen a shift in how they’re charged for electricity — especially when it comes to standing charges and network costs.
But here’s the key issue: a large number of businesses are now in the wrong charging band, and as a result, are paying far more than they need to.
At [Your Broker Name], we’re helping clients challenge their banding — and in many cases, reduce their fixed costs significantly. Here’s what you need to know.
⚡ What is the Targeted Charging Review?
The TCR was introduced by Ofgem to reform how electricity network charges are recovered from end users. Traditionally, a portion of these charges was based on how much electricity a site used — which meant savvy businesses could reduce their network costs through careful energy management or on-site generation.
The new system flips this on its head. Now, most Transmission Network Use of System (TNUoS) and Distribution Use of System (DUoS) charges are collected via fixed charges — known as residual charges — based on your charging band.
🏢 What Are TCR Charging Bands?
Under TCR, non-domestic electricity users are placed into bands (1–4) based on their average peak demand over a two-year period. These bands determine how much you’ll pay in fixed charges — regardless of how much energy you use now.
- Band 1 = Lowest standing charges
- Band 4 = Highest standing charges
So, if you’re in the wrong band, you could be paying thousands more per year in unnecessary fixed costs.
🛑 What’s the Problem?
Many businesses were placed in a band using historic demand data that’s now out of date — perhaps from before energy efficiency upgrades, building changes, or even a major downsizing.
This means:
- Businesses using less electricity now than they used to are still paying charges based on old high usage
- Businesses that moved premises or restructured during the pandemic may be misclassified
- New tenants may be inheriting a high banding from a previous occupant
📉 How Can You Reduce Your Fixed Costs?
The good news is: you can apply to have your banding reviewed and changed.
At The Utility Specialists, we’ve already helped clients:
- Identify incorrect bandings based on recent demand data
- Submit successful appeals to Distribution Network Operators (DNOs)
- Move from Band 4 or 3 down to Band 2 or 1 — with savings of up to 60% on fixed network charges
The process requires the right data and a good understanding of how each DNO applies the rules — but it can make a huge difference to your bottom line.
💡 What Should You Do Now?
Here’s a quick checklist:
✅ Check your band – Look at your energy invoice or ask your broker.
✅ Compare it to your current demand – Is your average peak load lower than what the band assumes?
✅ Get a TCR review – We can handle this for you, with no obligation.
✅ Act quickly – Changes don’t apply retrospectively, so the sooner you challenge it, the sooner the savings start.
⚠️ Don’t Just Focus on the Unit Rate
With TCR in place, it’s no longer just about getting the best kWh rate. The fixed standing and network charges can now make up a much larger portion of your bill — sometimes more than 50%.
That means businesses who take the time to optimise their banding can leap ahead of competitors still stuck on outdated charges.
👋 Need Help?
We’re experts in TCR reviews and network charge optimisation. If you think you might be in the wrong band, or just want to check, get in touch today. One conversation could cut your fixed electricity costs dramatically.