DUoS charges are part of the cost of delivering electricity through the regional network to your premises. You cannot avoid paying them but, with a commercial battery set-up, you can cut the bill by using less electricity from the grid at the most expensive times and keeping demand peaks down.
Read on to find out what DUoS charges are, what you’re paying for and which ones you can reduce.
What are DUoS charges?
Distribution Use of System (DUoS) charges pay for the operation, maintenance and improvement of the array of regional cables, substations and transformers that deliver electricity to commercial premises.
Your supplier passes your DUoS payments on to the companies responsible for carrying out this work, called Distribution Network Operators, or DNOs.
Depending on the contract and supplier, you may see DUoS as a separate item or as part of your unit rates and standing charge. DUoS is not one standard national rate as the amount you pay depends on your DNO region, connection, tariff, and electricity use.
Definition: TNUoS charges are separate and they pay for your use of the national transmission network.
What DUoS charges do commercial sites pay?
DUoS is one of several non-commodity charges included in a commercial electricity bill. The exact mix of DUoS charges you pay depends on your site’s connection and charging arrangements. If you have a larger half-hourly metered site, you may pay some or all of the following charges.
| Charge | What it means | Can your battery reduce it? |
|---|---|---|
| Time-based unit charge | A rate for each kWh you buy from the grid, which can change by time of day | Yes |
| Fixed charge | A daily charge for your connection to the local electricity network | No |
| Capacity charge | A charge for the maximum amount of power reserved for your site | Not automatically |
| Excess-capacity charge | An extra charge if your demand rises above the capacity agreed with your DNO | Potentially |
| Reactive power charge | A charge that may appear on your bill if motors and other electrical equipment use power inefficiently | Usually not |
The time-based charges in the table above are usually at their highest when the local network is busiest. The exact hours and prices vary but you can find them out by checking your electricity bill or asking your supplier which DUoS time bands apply to your site.
The fixed charge is a daily amount you pay for staying connected to the local network and this doesn’t go up or down with your electricity use.
Some sites also pay a capacity charge based on their Maximum Import Capacity (MIC). This is the maximum amount of power your DNO lets your site draw from the grid. You can normally find it on your bill or connection agreement.
Using a battery may help keep your actual level of demand below your MIC, but your DNO needs to agree to lower it before your capacity charge comes down.
A reactive power charge may appear if equipment such as motors uses electricity inefficiently. Your bill should show whether you pay it. An electrician or energy specialist can then check the cause and whether power factor correction equipment would help.
How a commercial battery can bring down DUoS charges
For most commercial sites with a suitable battery, there are two immediate opportunities.
Import less during expensive periods
If your DUoS unit rate changes through the day, reducing how much electricity you buy from the grid during the most expensive periods can bring down your costs.
For example, run equipment like EV chargers, pumps, or cooling systems at a cheaper time of day instead. When that equipment has to be on, use your battery to supply some or all of the electricity.
You still have access to all the power you need to run the site but you’re buying less of it from the grid when DUoS charges are at their highest.
Keep demand below your agreed Maximum Import Capacity
Equipment like machinery, refrigeration, HVAC, heat pumps, and EV chargers can create short spikes in demand for electricity. Using a battery to cover these spikes is known as peak shaving.
Switch to battery power instead and you avoid an excess-capacity charge. Your battery and inverter must be powerful enough to cover the spike, and it must be able to hold enough electricity to continue for as long as the extra demand lasts.
Definition: An inverter is the equipment that converts the battery’s electricity into power the site can use and controls how quickly it can be delivered.
Example: how a hotel can keep its grid demand down
Consider a hotel whose electricity demand rises to 270 kW for half an hour during an expensive DUoS period. kW measures how much power the hotel is using at a particular moment.
Pushing up usage are the kitchens, air conditioning, lighting and EV chargers, all of which are running at the same time. The hotel wants to keep the amount it draws from the grid at 250 kW.
Its battery has 100 kWh of usable capacity. kWh measures how much electricity the battery can store or supply over time.
The inverter can discharge at up to 50 kW, which is more than enough to cover the 20 kW gap. The battery starts the period with 50 kWh stored, although 20 kWh must remain available for backup.
| During the half-hour peak | Without battery support | With battery support |
|---|---|---|
| Site electricity demand | 270 kW | 270 kW |
| Battery output | 0 kW | 20 kW |
| Electricity drawn from the grid | 270 kW | 250 kW |
| Battery energy used over 30 minutes | 0 kWh | 10 kWh |
The hotel still receives the full 270 kW it needs. The battery supplies 20 kW of the energy it needs, so the meter records only 250 kW coming from the grid.
Supplying 20 kW for half an hour uses 10 kWh, leaving 40 kWh in the battery. The hotel keeps 20 kWh of this aside for backup. That could, for example, run 20 kW of essential equipment for about one hour, or 10 kW for about two hours.
By drawing 250 kW from the grid instead of 270 kW, the hotel buys less electricity during the expensive DUoS period and means it’s much more likely to avoid going above its agreed limit.
Drawing less electricity from the grid can reduce what the hotel pays during the expensive DUoS period. It may also help it stay below its agreed capacity. An installer or energy specialist would still need to check that 250 kW keeps the hotel within its formal limit, which is measured in kVA.
An installer or energy specialist would need to check that 250 kW is safely below the hotel’s official limit.
If the hotel stays well below that limit over time, it could ask the DNO to lower it and potentially reduce its capacity charge. The DNO must approve the change, and the hotel must be sure it will not need the extra capacity later.
A basic battery schedule might use the stored electricity too early in the day. The controller needs to save enough for the evening peak while keeping the hotel’s backup and other needs covered.
Could your battery setup lower your DUoS charges?
Your commercial battery storage set-up could lower your DUoS charges when:
- Your DUoS rate is higher at certain times of day
- Your electricity demand sometimes rises above your agreed limit
- Your battery has enough stored electricity and power available when these increases happen
GridVolt can review your electricity data, tariff and current battery set-up to show where DUoS charges are adding to your bill and whether changing when your battery charges and discharges could bring them down.
Our Energy Manager software, compatible with many installed batteries and inverters, changes when your battery charges and discharges based on your tariff, expected electricity use, solar generation and backup needs.
Fill in the form on the page or click here for our contact page for a review of your site.