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Distribution Use of System (DUoS) and other network charges determine part of the cost base for generators connected behind the meter. Ofgem has reviewed distribution charging to reflect changing grid usage patterns, the growth of distributed energy resources and the need for efficient locational signals. When charges shift from general volumetric tariffs to more locational or time‑differentiated components, the relative economics of rooftop solar — which exports at different times and places — can change.
For hosts and investors in small-scale solar, two effects are important. First, locational charging can advantage generation sited in areas with spare capacity and penalise generation in heavily constrained areas. Second, time‑of-export considerations interact with settlement arrangements: export that coincides with peak local demand may receive higher value than mid‑day exports in oversupplied networks. These regulatory features influence decisions about storage pairing and export management.
Metering, settlement and access to flexibility markets also shape value. If small generators can participate in local flexibility arrangements or receive payments for providing distribution system support, that can offset weaker wholesale export prices. Conversely, high fixed charges or unfavourable export compensation reduce project yields and extend payback timelines.
Retail investors looking at fractional investments in rooftop solar or building‑hosted batteries should therefore consider how network charging and export rules affect long‑term cashflow. Understanding the regulatory backdrop to distribution charging helps assess whether a project’s revenue assumptions are resilient to evolving grid economics.