Network Charging Compensation Increased to 90%: What It Means for Energy Intensive Industries

Network Charging Compensation has become significantly more valuable to eligible Energy Intensive Industries following an increase in the level of relief from 60% to 90%.

From 1 April 2026, eligible network charges incurred by qualifying Energy Intensive Industries can benefit from compensation at the increased 90% rate.

For manufacturers already participating in the British Industry Supercharger, this represents a substantial increase in the value of the support available.

It also makes effective management of Network Charging Compensation increasingly important.

What is Network Charging Compensation?

The Network Charging Compensation (NCC) Scheme forms part of the Government's British Industry Supercharger package.

It was introduced to help address the electricity-cost disadvantage experienced by some of Britain's most energy-intensive manufacturers compared with international competitors.

The scheme provides qualifying businesses with compensation relating to eligible electricity network charges.

NCC originally provided relief at 60%.

Following consultation, the Government committed to increasing this to 90% from 1 April 2026.

What has changed?

The change is straightforward in principle but significant financially.

Eligible network charges incurred from 1 April 2026 can now attract compensation at the 90% rate rather than 60%.

Government guidance has subsequently been updated to reflect the increased level of relief.

The Government has also extended NCC application windows to two months, beginning with the Q2 2026 application window.

For businesses with substantial electricity consumption, the combination represents an important development in the value and administration of the scheme.

When will businesses receive the additional support?

There is an important timing distinction.

Although the increased compensation applies to eligible charges from 1 April 2026, NCC operates in arrears.

The Government has stated that businesses submitting claims relating to the increased rate can expect the first uplifted compensation payments after April 2027.

Businesses should therefore distinguish between:

when eligible expenditure is incurred

and

when compensation relating to that expenditure is ultimately received.

This distinction can be important for forecasting and internal budgeting.

Why the increase matters

Moving from 60% to 90% compensation represents a 50% increase in the level of relief on the relevant eligible charges.

For an EII with significant network costs, that can materially increase the value of the scheme.

The Government has subsequently estimated that increasing NCC support could save currently supported businesses up to £420 million per year in total.

For manufacturers, however, the practical issue isn't simply the headline percentage.

Businesses still need to ensure that their claims accurately reflect their circumstances and the applicable scheme requirements.

NCC remains an ongoing process

Network Charging Compensation should not be viewed as a one-off application.

Claims operate through recurring application windows and require businesses to maintain appropriate information and supporting evidence.

Changes within a business can also introduce additional considerations.

These could include:

• new electricity suppliers;

• meter changes;

• additional manufacturing sites;

• changes in corporate structure;

• acquisitions or disposals; and

• significant operational changes.

As the financial value of NCC increases, ensuring these matters are properly reflected becomes increasingly worthwhile.

What should EII businesses consider now?

Businesses already participating in the British Industry Supercharger should ensure they understand how the increased relief affects their NCC position.

This is particularly relevant where:

• NCC has not previously been claimed;

• responsibility for submissions has changed internally;

• there have been changes to sites or meters;

• the electricity supplier has changed;

• previous applications were completed without specialist support; or

• there is uncertainty around future submission requirements.

The increased level of compensation means that previously overlooked issues may now carry greater financial significance.

Our view

Increasing NCC from 60% to 90% materially strengthens the British Industry Supercharger.

It also changes the cost-benefit calculation around managing NCC effectively.

At 60%, businesses already had good reason to ensure eligible costs were being captured appropriately.

At 90%, that argument becomes stronger.

Manufacturers should therefore treat NCC as an important component of their wider EII strategy rather than an administrative afterthought.