Businesses face steep rise in energy charges by 2030

25 September 2025

Some of Britain’s largest energy users could face annual bill increases of nearly half a million pounds by 2030, according to new analysis from consultancy Cornwall Insight.

The rise is linked to non-commodity costs, also known as third-party charges (TPCs), which are added to wholesale energy prices to cover the cost of running the grid and funding government schemes. Cornwall Insight’s Business Energy Costs Forecast suggests the average increase for big energy users could reach £450,000 a year, equivalent to around 5% of current bills.

Industries such as retail, water utilities and transport are expected to be among those most affected, as many do not qualify for existing government relief schemes.

A key driver is investment in transmission lines to connect renewable power from remote areas, expected to add about £100,000 to bills from 2026 and almost £250,000 by 2030. A further £200,000 is forecast from a new funding model for nuclear power stations. Other costs, including support for hydrogen production and discounts for households near pylons, could also play a role, though details are still being finalised.

Most of the increases will come through higher standing charges, which businesses cannot avoid by changing how they use electricity. Ofgem has said these costs were anticipated and should be balanced in the long term by a stronger grid. The government has argued that investment in nuclear power will bring lower prices and greater energy security.

Some of the most energy-intensive industries will receive relief through the Network Charging Compensation scheme, with discounts of up to 90%. Smaller eligible firms could also see cuts of up to a quarter from 2027. But many other large energy users will remain outside the scope of support.

Dr Craig Lowrey, principal consultant at Cornwall Insight:

“Every step we take towards a cleaner, more resilient energy system has a cost, and that money has to come from somewhere. Investment in new transmission lines, nuclear power, and backup capacity are the backbone of the UK’s future energy security.

“But the way those costs fall matters. There is a real risk of a system where some businesses are protected while others shoulder the full weight. For many, these charges can mean difficult decisions about jobs, investment, and prices. The challenge is to fund the transition fairly, so we build the low carbon system we need without leaving households and businesses carrying an impossible burden.”