Possibly. A "fixed" business energy contract only stays fixed if the whole price is fixed. If your contract has a pass-through clause, your supplier can add rises in network and balancing charges on 1 April 2027 without breaking the deal. The only way to know is to check your written terms.
Several costs that make up business electricity bills are set to go up next spring. With most contracts running across that date, now's a good time to find out exactly what you agreed to.
What is a pass-through charge?
Your energy price has two parts. One is the commodity cost: the wholesale gas or electricity itself. The other is the non-commodity cost: network charges for the transmission and distribution grids, system balancing costs, government levies and metering.
Suppliers handle the non-commodity part in one of two ways:
- Fully fixed. The supplier estimates every charge for the length of the contract and builds it into the unit rate and standing charge you sign up to. If the charges go up, the supplier takes the hit.
- Fixed with pass-through. The wholesale part is fixed, but the contract lets the supplier pass changes in some or all of the non-commodity charges straight on to you during the term.
Pass-through contracts often look cheaper when you sign, because the supplier isn't pricing in the risk of rising charges. The catch is that you're carrying that risk instead.
Ofgem's own guidance for microbusinesses makes this point. It notes that some parts of a bill may change during the contract and may be presented on a pass-through basis, and it tells businesses to check whether their price can change during the contract term.
Which charges are going up on 1 April 2027?
As of November 2026, three cost lines are due to rise:
Transmission network charges (TNUoS). These pay for the high-voltage grid. Most businesses pay the biggest part of them as a fixed daily charge per site, whatever they use. In NESO's initial 2027/28 forecast, published in May 2026, the daily demand residual charges were set to rise by 21% on average. NESO's October 2026 five-year view then put 2027/28 residual tariffs 5% above that initial forecast, because there's more revenue to collect. These figures are still forecasts. Final tariffs are due early in 2027.
Balancing charges (BSUoS). These cover what NESO spends keeping the grid stable. As of November 2026, the rate is fixed at £12.49/MWh for October 2026 to March 2027. NESO's draft rate for April to September 2027 is £21.67/MWh, a rise of about 74%. The draft rate for October 2027 to March 2028 drops back to £18.42/MWh. The jump comes from NESO carrying forward a deficit of around £1 billion rather than raising this winter's rate.
Climate Change Levy (CCL). The main rate on electricity and gas is 0.801p per kWh for 2026/27. It rises to 0.827p per kWh from 1 April 2027, as published on GOV.UK. CCL is a tax, so check how your contract treats tax changes. Many suppliers bill it as a separate line at whatever rate applies at the time.
On a fully fixed contract, the TNUoS and BSUoS rises shouldn't change your bill until you renew. On a pass-through contract, they could show up from your April 2027 bill onwards.
How do you tell whether your contract is fully fixed?
Don't rely on the word "fixed" in a sales call or on the front page of a quote. Look in the written terms for:
- A clause on "third-party charges", "non-commodity costs", "pass-through" or "network charges", saying the supplier can change prices if these change.
- A list of named charges that can vary, such as TNUoS, DUoS, BSUoS, Capacity Market or Contracts for Difference costs.
- Wording about "changes in law or regulation". This can let costs through even on contracts sold as fixed.
- Whether a price change applies only to charges above what the supplier estimated at the start, or to the whole charge.
- How much notice the supplier must give before changing your price.
If you're a microbusiness, your supplier must give you the contract's principal terms, which include the terms about charges. Ofgem defines a microbusiness as having fewer than 10 employees and turnover or a balance sheet of no more than £2 million, or using up to 100,000 kWh of electricity or up to 293,000 kWh of gas a year. Citizens Advice also suggests checking how much you'll pay per unit and whether the price can change before you agree to any contract.
If the terms aren't clear, ask the supplier in writing: "Which parts of my price are fixed for the full term, and which can change?" Keep the reply.
Can a supplier raise a fixed price if they didn't make the clause clear?
This is where Ofgem's Standards of Conduct come in. Since Ofgem's 2024 Non-Domestic Market Review decision, they apply to all non-domestic customers, not just microbusinesses. They require suppliers to treat customers fairly and to communicate clearly.
Ofgem's Standards of Conduct guidance describes this exact situation. Customers thought they'd bought a fixed price, prices then went up during the contract, and the supplier pointed to a clause allowing increases in certain circumstances. Ofgem says that where the principal terms about charges hadn't been made clear enough before signing, that's the kind of conduct the Standards are there to stop. If a supplier uses such clauses, it should bring them to the customer's attention so the customer knows the price may change.
So a pass-through clause isn't automatically unfair. But if it was buried, or you were told the price was fully fixed, you may have grounds to complain.
What if you're hit with a mid-contract increase?
First, check that the increase matches the clause. It should relate only to the named charges, and the supplier should be able to show how it worked the figure out. Ask for a breakdown showing the old rate, the new rate and which charge caused the change.
If you think the increase isn't allowed under your contract, or the clause was never made clear, make a formal complaint to the supplier. Ofgem's market review rules require suppliers to have complaints processes for small business consumers and to tell them about the Energy Ombudsman. If the complaint isn't resolved, you can usually take it to the Ombudsman once the supplier issues a deadlock letter or eight weeks have passed, whichever comes first. Keep copies of your contract, any sales emails or call notes, and your bills from before and after the change.
Should you choose fully fixed or pass-through at your next renewal?
Neither is right for everyone. A fully fixed price gives you certainty, which helps if you have a tight budget or can't absorb surprises. A pass-through contract may cost less at the start, but you take on the risk of network charges rising. NESO's latest five-year view forecasts the revenue behind those charges rising from £7.97bn in 2027/28 to £11.66bn by 2031/32.
Whichever you pick, compare quotes on the same basis. A pass-through quote and a fully fixed quote aren't like-for-like. Ask each supplier to confirm in writing which parts of the price are fixed.
What to do next
- Find your current contract and check its end date. Does it run past 1 April 2027?
- Search the terms for "pass-through", "third-party charges", "non-commodity" or "change in law".
- Ask your supplier in writing which parts of your price are fixed and which can change, and keep the reply.
- If you're on pass-through terms, budget for higher standing charges and unit costs from April 2027.
- Check your first bill after April 2027 against the rates you agreed.
- If a rise doesn't match your contract, complain to the supplier and escalate to the Energy Ombudsman if needed.
- At renewal, get it in writing whether each quote is fully fixed or pass-through before you compare prices.
This is general information, not financial advice.