What is RIIO-ET3 and how will it affect your business?

RIIO-ET3 is one of those industry terms most businesses won’t hear about until it starts affecting energy bills.

And that’s exactly what’s happening.

While it doesn't directly change how your business uses electricity, it influences how Great Britain's energy network is funded and why some charges on your bills have increased in recent years.

We break down RIIO-ET3 so you can understand what is coming down the tracks for business energy users and why.

In this article:

• Learn what RIIO-ET3 stands for and how it works.
• Understand why Ofgem introduced RIIO-ET3 and who it affects.
• Discover what RIIO-ET3 could mean for your business and future energy costs.

What is RIIO-ET3 and what does it stand for?

RIIO-ET3 is Ofgem’s price control for electricity transmission networks. It sets the revenue network operators can recover from consumer bills and what they must provide in return.

Essentially, its role is to strike a balance between investment and protecting customers from paying more than necessary to fund projects.

The guidelines encourage network operators to:

• Deliver reliable energy networks.
• Invest efficiently.
• Innovate and modernise infrastructure.
• Meet performance targets set by Ofgem.

RIIO stands for Revenue = Incentives + Innovation + Outputs, while ET stands for Electricity Transmission, the high-voltage network that transports power across Great Britain.

The ‘3’ indicates this is the third control period, spanning 2026-2031, which sets the funding and performance expectations for transmission network operators over several years.

Why does RIIO-ET3 exist?

Great Britain's electricity network is undergoing an enormous transformation as the country moves towards the Net Zero target and increasing supply from renewable sources.

At the same time, electricity demand is expected to grow as businesses and households adopt technologies such as electric vehicles, heat pumps and battery storage.

Much of the existing network was designed for a very different energy system. Large-scale investment is now required to expand capacity, improve resilience and connect new renewable projects to the network.

Rather than simply allowing unlimited investment, Ofgem sets expectations around costs, service quality, reliability and innovation to balance infrastructure improvements with affordability.

What does RIIO-ET3 mean for your business?

For most businesses, RIIO-ET3 will not have an immediate impact on day-to-day operations or suddenly change energy bills overnight.

Over the long term, the effects of RIIO-ET3 should lead to a gradually more reliable, resilient energy network for everyone, with greater capacity to handle greater usage by connecting new renewable generation sites.

That all sounds positive, but the scale of investment is significant. And rising. Planned electricity transmission spending is expected to increase from around £18 billion during RIIO-ET2 (2021–2025) to up to £70 billion during RIIO-ET3 (2026–2031).

Transmission investment could be almost four times higher than in the RIIO-ET2 period.

Some of these costs started to feed through into network charges from April 2026, which can appear on your bill in the form of standing charges.

If you're reviewing or renewing your energy contract, you may notice higher network costs and standing charges reflected in the prices you're offered.

How we can help

Business energy is complex. We get it. We can support you.

Troo exists to help businesses make sense of their energy needs. We simplify information and help you make smart decisions that manage costs and lead to real change.

We are not here to sell you a quick fix. We're here to understand what matters to you, offer clear advice, and take ownership of the hard parts, so energy becomes one less thing to worry about.

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