What does the National Grid’s BSUoS cost increase mean for you?


What does the National Grid’s BSUoS cost increase mean for you?

June 17, 2020

Covid-19 and lockdown has seen demand for electricity fall in Great Britain by up to 20%. National Grid, the electricity network operator who manages the electricity system, forecast that the low demand will cost them an additional £500 million in balancing the electricity transmission system.

The additional costs will be recovered through a charge known as Balancing Services Use of System charges (BSUoS) – which generators and end-users are liable for – set to be applied between June and August and an increase of around 90% on average.

BSUoS costs are charged on a half-hourly basis and can range from £0-£20 an hour in a single day, dramatically changing the dispatch patterns of all generation and supply. Furthermore, the charges are only accurately reported around one month after delivery, making it even harder to forecast the real BSUoS cost of supplying as a generator or importing as an end-user.

National Grid Balancing Services Use of System chart

What do additional BSUoS costs mean for electricity generators and consumers?

If you generate a large amount of electricity (typically 50MW and upwards) and connect to the national transmission system, you will be charged these increased costs per hour of generation. Therefore, your marginal costs will rise by an unknown amount and you will need to charge more for generation. This, in turn, will directly impact the wholesale price of power.

Generators that are connected to the distribution network lower down the system, rather than to the high voltage National Grid (also known as ‘embedded generators’), will be paid these BSUoS rates. Thus, the cost of generation will decrease.

For end-users, the cost of electricity will increase at an uncertain half-hourly cost. Depending on who supplies your electricity, some of this risk may sit with your supplier; especially if you have a fixed fee contract with them that includes assumed BSUoS costs vs higher BSUoS costs.

This is why some larger suppliers are attempting to defer the impact of BSUoS. They want to spread the cost of additional balancing during COVID-19 equally across all the settlement periods during 2021/22 to ease the pain the unprecedented charges could have on them.

In addition, OFGEM is currently consulting on whether BSUoS should be recovered on demand-only (and not with generators) so that we better align with Europe. This would see an increase in BSUoS costs for end-users but would be offset by an equivalent reduction in wholesale market prices. This in turn will impact the power that is flowing to and from Europe to the UK.

The benefit of being a Hartree client in light of BSUoS and Covid-19

For most businesses, there’s a divide between their energy supplier and their asset optimisation partner. Ultimately, this means that they do not benefit directly from the optimisation of assets, instead, the benefits flow to their current supplier.

Here at Hartree Solutions, we become your energy supplier and your optimisation partner so that you are the one who benefits. We pass additional revenues (like those highlighted in the chart below) to you directly or we guarantee you a long-term fixed power price discount. This gives your business savings and certainty that’s not offered elsewhere.

Balancing Services Use of System forecast and outturn chart

If you’d like to discuss a partnership with Hartree, please get in touch.

written by
Brendan Mycock

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Japan, 14th December 2023: Japanese power company, Kansai Electric Power Group (Kansai Group), has signed…

Japan, 14th December 2023: Japanese power company, Kansai Electric Power Group (Kansai Group), has signed a binding term agreement with Hartree Partners for the supply of LNG alongside investment in a nature-based carbon project in Australia, the first deal of its kind in Japan. The deal represents Kansai Group’s long-term commitments to decarbonisation and the provision of low-carbon energy for its customers. 

This LNG supply agreement enables KE Fuel Trading Singapore Pte. Ltd (KEFTS) to grow its LNG portfolio which will support Kansai Group’s LNG supply-demand situation and customers around the globe.  

Also, through its expertise in global carbon markets and its project portfolio in Australia, specifically focused on nature restoration, Vertree Partners, Hartree’s global carbon market arm, will support The Kansai Electric Power Co., Inc. (Kansai Electric) to access future supply of high-integrity carbon credits to support its Zero Carbon Vision.  

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Hartree Partners is a well-established global energy and commodities firm with decades of experience in the physical and financial energy and commodities market. Its wholly-owned subsidiary, Vertree Partners, is focused on decarbonisation and environmental markets.  

“Carbon credits have an important role to play in realising a zero-carbon society,” said Hideaki Ikai, Executive Officer, Operation and Trading Division in Kansai Electric. “Kansai, as a leading company of zero-carbon energy, is proactively studying ways to create a carbon neutral society, and I believe that this collaboration with Hartree Partners will accelerate our activities to achieve the goal of carbon net zero by 2050.” 

Shinichi Kudo, Chief Executive Officer, KEFTS, added “The combination of LNG and carbon credits will give us a promising option to attain our mission to provide our customers with stable energy supply and decarbonization solutions.” 

Ahmed S Al-Awa, Managing Director of Hartree Partners Singapore Pte. Limited and a Partner of Hartree Partners, said “this forward-looking move by Kansai Electric Power Group sends an important signal that carbon markets are likely to become a key component of the natural gas/LNG value chain as the sector moves to decarbonise.” 

Ariel Perez, Managing Partner of Vertree Partners added “We are committed to supporting Kansai Electric Power Group to make credible investment in the carbon market. The market is evolving rapidly, and companies may be increasingly exposed. Investments such as these support future preparedness whilst also directing finance to nature-based solutions, without which we face continued environmental degradation and eco-system loss and increase the risk of missing our global climate goals.” 


About The Kansai Electric Power Co., Inc. 

Kansai Electric Power Group, as a Japan’s leading electric power company, is aiming for carbon neutrality throughout the entirety of its business activities by 2050 to limit global warming, while increasing energy independence to secure energy supply for its customers, Kansai Group can be found at 

About KE Fuel Trading Singapore Pte. Ltd 

KEFTS, a 100% subsidiary of Kansai Electric, was established as an LNG trading arm of Kansai Group in April 2017. KEFTS has been supporting Kasai Electric’s LNG supply-demand balance and providing LNG portfolio for customers around the globe, and now enhances its activity to support Kansai Group’s carbon neutrality at its base in Singapore.

About Hartree Partners  

Hartree Partners, LP is a leading global energy and commodities firm with an international reputation for integrity developed over decades. Our expertise enables us to capitalise on the transition from fossil fuels to a low carbon economy. Hartree’s global breadth and reach provide a competitive presence in a comprehensive range of commodity markets, enriched by the firm’s employees who add deep insight, expertise and innovative thinking. More information concerning Hartree can be found at 


About Vertree Partners 

Vertree Partners enables leading companies and institutions to invest in both nature and innovative climate technologies to assist them in reaching their decarbonisation goals. Founded in 2020, Vertree is focused on driving positive environmental and social impact, and providing its customers access to existing and future supply of high-integrity environmental commodities. It does this through directly financing quality emissions reductions and removals projects; partnering with renowned project developers; investing in innovative organisations and technology-based solutions; and providing its expertise in voluntary and compliance markets, trading, market analytics and risk management. Vertree is wholly owned by Hartree Partners. 


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Since its inception in February 2021, Hartree and AGP’s European solar venture, AMPYR Solar Europe (ASE), is making swift progress towards its goal of rolling out 5GW of large-scale solar projects to establish itself as one of the largest utility scale solar platforms in Europe. ASE also recently closed a €400 million facility to support this plan.

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“We are excited to take another step forward with AGP into the US market,” said Stephen Semlitz, Managing Director of Hartree. “This new venture allows us to further demonstrate our decades of experience in finding investment solutions, consulting, and generating sustainable and commercially viable strategies for energy renewal and regeneration.”

To learn more about the new US venture visit:

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