Compare UK business energy pass-through charges (PTCs)
Pass-through charges can materially change your total business energy bill. This guide explains what they are, how suppliers apply them, and how to compare quotes fairly before you sign.
- Understand common PTCs (TNUoS, DUoS, BSUoS, RO, FiT, CfD, CCL and more)
- See what’s “included” vs “pass-through” in contract terms
- Use our checklist and scenarios to compare quotes like-for-like
Estimates only. Charges, bands and methodologies vary by supplier, meter type, network area and contract terms.
Fast answer: what are pass-through charges in business energy?
In UK business electricity and gas contracts, pass-through charges (often shortened to PTCs) are costs that suppliers may bill separately from your unit rate (p/kWh) and standing charge. They’re typically third-party or industry charges that can change during your contract (for example, network and balancing charges).
Why PTCs matter when comparing
Two quotes can show the same p/kWh but produce different totals if one quote includes more charges in the unit rate and the other passes them through on your bill.
What to ask for (minimum)
Request a like-for-like breakdown: what’s included in the p/kWh, what is pass-through, and whether pass-through is billed at cost, cost plus admin, or capped/uncapped.
Key UK-specific nuance
PTCs can vary by meter type (HH vs NHH), DNO region, profile class / consumption pattern, and industry changes. Terms matter as much as price.
Quick takeaway: Don’t compare business energy on p/kWh alone. Compare total expected cost using the same consumption assumptions and an explicit list of included vs pass-through charges.
Compare business energy quotes with PTC clarity
If you want a quote that’s easier to compare, we’ll ask for a few basics and match you with suitable options. We’ll help you check:
- Whether PTCs are fully inclusive, part inclusive or fully pass-through
- How the supplier defines “third-party charges” in their terms
- What’s likely to impact your costs: DNO area, meter type, HH data, capacity and site pattern
Tip for accuracy: If you have it, keep a recent bill handy (electricity MPAN and/or gas MPRN, and annual kWh). It improves like-for-like comparisons.
What happens after you submit?
- We review your details and the meter type (HH/NHH where applicable).
- We source suitable whole-of-market business energy options (availability varies by supplier and eligibility).
- We highlight material contract terms—especially any pass-through definitions and billing approach.
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How to compare pass-through charges (step-by-step)
To compare UK business energy PTCs fairly, treat it like a procurement exercise: align assumptions, force clarity in writing, then compare totals.
1) Confirm your meter set-up
- Electricity: Half-hourly (HH) or Non-HH; profile class; MPAN.
- Gas: MPRN; AQ (annual quantity) band; read frequency.
- Any capacity/agreed supply level or site constraints.
2) Ask what the quote includes
- Are network and policy charges bundled into p/kWh?
- Which items are explicitly labelled “pass-through / third-party”?
- Is pass-through billed at cost, cost + uplift, or with caps?
3) Compare using an “all-in” estimate
Ask each supplier (or broker) to provide an estimated all-in p/kWh based on the same annual kWh and meter type, plus the contract wording that defines what can vary.
4) Check billing and cashflow impacts
- Monthly vs quarterly billing; actual vs estimated reads.
- How/when DUoS or TNUoS peaks apply (for some sites).
- Any credit terms, deposits, or payment method restrictions.
Reality check: A “fully fixed” price can be simpler, but may price in risk. A “pass-through” structure can be lower upfront, but exposes you to charge movements. The right fit depends on your tolerance for bill variability and your ability to forecast.
PTC comparison: contract types and what usually varies
Suppliers use different terminology, but many business electricity contracts fall into three broad pricing styles. Use this table to sanity-check what you’re being offered.
| Quote style (common label) | What’s usually included | What may be pass-through | Best for | Watch-outs |
|---|---|---|---|---|
| Fully inclusive / all-in | Most network + policy costs bundled into unit rate and standing charge (definitions vary). | Some residual items still can vary depending on terms (e.g., metering, capacity, exceptional changes). | Businesses prioritising predictable bills and simpler budgeting. | May be priced higher to cover risk; check what “inclusive” excludes. |
| Part inclusive | Energy + some charges fixed; others passed through. | Often network-related (DUoS/TNUoS) and/or policy/balancing items (supplier-defined). | Businesses wanting a balance of price and predictability. | Harder to compare: insist on an itemised PTC list in writing. |
| Pass-through / “third-party charges at cost” | Supplier energy margin fixed; third-party charges billed separately (terms vary). | Potentially most non-energy components, depending on contract definition. | Energy-literate teams comfortable with bill variability; some larger/HH sites. | Confirm whether “at cost” includes admin/uplift; check how changes are evidenced. |
Decision checklist: who pass-through may (and may not) suit
Pass-through may suit if you…
- Can tolerate in-year bill changes and budget with ranges.
- Have HH data or detailed consumption insight.
- Want transparency on industry costs rather than bundled risk pricing.
- Have internal sign-off for variable components.
It may not suit if you…
- Need fixed monthly outgoings for cashflow certainty.
- Have tight margins and limited ability to absorb winter cost spikes.
- Don’t have time to scrutinise bills and contract definitions.
- Prefer a single, easily comparable all-in rate for procurement.
Two realistic scenarios (with numbers)
These examples show how PTC treatment can change your total. They’re illustrative estimates using simplified assumptions (real bills can differ by region, meter set-up, DUoS banding, consumption shape and contract wording).
Scenario A: small office (NHH electricity)
- Assumptions
- Annual use 18,000 kWh; standing charge £0.55/day; contract 12 months; VAT ignored for simplicity; all figures indicative.
- Quote 1 (more inclusive)
- Energy unit rate 30.0p/kWh. Estimated “other charges” included in rate. Total energy: £5,400. Standing charge: ~£201/year. Estimated total: £5,601.
- Quote 2 (lower unit rate + pass-through)
- Energy unit rate 27.0p/kWh. Pass-through charges estimated at 3.5p/kWh (network/policy/balancing mix, varies). Total energy: £4,860. Pass-through: £630. Standing charge: ~£201/year. Estimated total: £5,691.
Interpretation: the cheaper p/kWh can be more expensive overall if pass-through estimates rise or if exclusions are broader than expected.
Scenario B: light industrial unit (HH electricity)
- Assumptions
- Annual use 160,000 kWh; HH meter; standing charge £1.20/day; consumption more daytime-heavy (higher network impact). VAT ignored; all figures indicative.
- Quote 1 (all-in HH style)
- All-in unit rate 26.5p/kWh. Total energy: £42,400. Standing charge: ~£438/year. Estimated total: £42,838.
- Quote 2 (pass-through HH style)
- Supplier unit rate 22.8p/kWh plus pass-through estimated at 3.2p/kWh (but variable). Total energy: £36,480. Pass-through: £5,120. Standing charge: ~£438/year. Estimated total: £41,? (˜ £41,? ) — approx £41,? (˜ £41,? ) depending on final pass-through.
Important: HH sites can see cost swings due to DUoS bands, capacity-related charges and timing. Always request supplier assumptions and, where possible, model with your HH profile.
Note on the numbers: We’ve kept scenarios intentionally simple to show the comparison method. For an accurate view, you need your network region, meter class, and contract wording about which charges can be varied and how.
Common pass-through charges, exclusions and pitfalls (UK)
Pass-through is often described as “third-party charges”. The exact list varies by supplier and contract, but these are commonly referenced on UK business electricity bills and terms.
Network charges (often variable)
- DUoS (Distribution Use of System)
- TNUoS (Transmission Network Use of System)
- Sometimes capacity and related network items (site-dependent)
These can vary by DNO region, time bands and site characteristics.
Balancing & system charges
- BSUoS (Balancing Services Use of System)
- Other balancing/system operator charges (supplier-defined)
Definitions differ—ask how the supplier groups “system” charges.
Policy & environmental charges
- RO (Renewables Obligation)
- FiT (Feed-in Tariffs)
- CfD (Contracts for Difference)
- CCL (Climate Change Levy) (tax; eligibility/exemptions apply)
Some deals bundle these; others pass them through.
Pitfalls we see in business quote comparisons
“At cost” isn’t always the same thing
Some contracts allow an admin fee/uplift or use supplier-defined indices. Ask what evidence is provided for charge changes and how they’re calculated.
Broad “third-party charges” definitions
If the contract definition is wide, more of your bill can move during the term. Request an itemised schedule of what counts as pass-through.
Comparing different assumptions
A quote may assume different annual usage, read frequency, DUoS bands, or HH profile. Ensure all quotes use the same consumption basis.
Contract terms to locate before signing: (1) “Definitions” (third-party charges), (2) “Price variation” clause, (3) billing frequency and read requirements, (4) termination/renewal and any fees, (5) VAT/CCL treatment and eligibility.
FAQs: business energy pass-through charges (UK)
1) Are pass-through charges legal in UK business energy contracts?
Yes—business contracts can include variable components, provided the terms explain what can change and how it’s applied. Because business energy is typically a contract market, always review the written terms and request clarity in writing before you agree.
2) What’s the difference between “all-in” and “pass-through” pricing?
All-in usually means more charges are bundled into the p/kWh and standing charge, reducing bill variability. Pass-through means more non-energy items are billed separately and can change during the contract term. “All-in” still may exclude some items depending on supplier definitions.
3) Do pass-through charges vary by location?
Many can. Electricity distribution charges (DUoS) vary by DNO region and may depend on time-of-use bands. Gas network charges can vary by GDN and consumption banding. Your postcode helps identify the relevant network area, but metering details matter too.
4) Are pass-through charges higher for half-hourly (HH) meters?
Not automatically higher, but HH sites can be more exposed to charges linked to when you use electricity (e.g., peak times) and site-specific factors (like capacity). This can increase variability compared with a simple non-HH profile.
5) Can a supplier change my unit rate if my contract has pass-through charges?
Typically, pass-through refers to non-energy components, while the supplier’s energy rate/margin may be fixed. However, what can change depends on the contract’s price variation and definitions. Always confirm what is fixed and what can vary.
6) Are pass-through charges the same as VAT and CCL?
No. VAT is a tax applied to the bill total (business VAT treatment varies by circumstances). CCL is a tax on energy use, but some organisations may have reliefs/exemptions depending on eligibility. Ask how VAT and CCL are handled in the quote.
7) What should I request to compare quotes properly?
Ask for (a) a list of included charges, (b) a list of pass-through items, (c) whether pass-through is cost, cost+uplift, or capped, and (d) an estimated all-in cost using your annual kWh and meter type. If HH, ask what profile or assumptions were used.
8) Can pass-through charges cause issues at renewal?
They can. If you compare on headline p/kWh and ignore variable components, you may underestimate ongoing costs. Also check renewal windows and termination rules—many business contracts have specific notice requirements.
If you’re unsure: We can help you request a like-for-like breakdown so you understand what’s fixed, what’s variable, and what you’re actually comparing.
Trust, methodology and sources
Page details
- Written by
- EnergyPlus Editorial Team
- Reviewed by
- Energy Specialist
- Last updated
- February 2026
How we assess pass-through charge comparisons
This guide is written to help UK businesses compare quotes fairly. We focus on practical comparability rather than forecasting exact charge levels.
- Definitions-first approach: we prioritise the contract definition of “third-party/pass-through charges” and the price-variation clause, because these determine what can change.
- Like-for-like assumptions: we encourage comparing on the same annual kWh, meter type (HH/NHH), and network area.
- Total-cost lens: we recommend an estimated all-in total as a decision aid, then checking which parts can vary.
Limitations: Charge names and groupings vary by supplier; some items are site-specific; industry charges can change over time. The scenarios on this page are simplified and are not a quote.
Sources and further reading (UK)
- Ofgem (UK energy regulator) — guidance on energy markets and regulation.
- Citizens Advice: energy advice — consumer-facing explanations that can help with terminology.
- GOV.UK: Climate Change Levy (CCL) — background on CCL and related schemes.
We link to third-party sources for transparency. EnergyPlus is not responsible for external site content.
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