The Nuclear RAB levy: what it is, why it's on your bill, and why it's going up

Every UK business energy customer is now paying a charge toward a power station that hasn't been built yet. The Nuclear RAB levy appeared on business bills for the first time in November 2025, and from April 2026, the rate jumped from around £3.50/MWh to £4.683/MWh - roughly £1/MWh more than the previous quarter.

Most businesses haven't been told what it is. Here's what's actually happening.

What the Nuclear RAB levy is

RAB stands for Regulated Asset Base. The UK government wants to build Sizewell C, a new nuclear power station on the Suffolk coast. Nuclear power has a lot of things going for it - it produces large amounts of low-carbon electricity, it runs continuously regardless of whether the wind is blowing or the sun is out, and the UK has been leaning on it as a key piece of the Clean Power 2030 strategy.

The problem is the cost. Nuclear plants take years to build and require billions of pounds of investment before they generate a single unit of electricity. Under the old model, investors would only get paid back once the plant was operating and selling power. That's a risky position for investors to be in, so they charged higher financing costs to compensate - which ultimately made the electricity more expensive for everyone.

The RAB model changes the timing. Instead of waiting until Sizewell C is built and running, the government decided to spread the construction costs across electricity bills now, while building is underway. Investors get paid during construction, which reduces their financing risk and, in theory, reduces the total cost of the project over its lifetime.

The Nuclear RAB levy is how that cost reaches businesses. The Low Carbon Contracts Company (LCCC) - a government-owned body - collects the levy from licensed electricity suppliers, who then pass it through to their customers.

That means every UK business using electricity is contributing to Sizewell C's construction budget, whether they signed up for it or not.

A simple way to picture it

Think of it like a neighbourhood deciding to install a shared generator. Normally, whoever owns the generator would borrow money, build it, and pay back the loan from future earnings once it was running.

With the RAB model, all the neighbours start chipping in before the generator is built. Payments begin now, with the promise that when it's finally running - in Sizewell C's case, some time in the 2030s - it will provide low-carbon power for decades.

You're paying upfront, for something you won't use for years, and you didn't get a vote on whether to join.

Why the rate came in so much higher than expected

When the Nuclear RAB scheme was first discussed, early projections put the Interim Levy Rate at around £0.30/MWh - a relatively minor figure. When rates were published in 2025, the actual levy came in at £3.455/MWh for the Interim Levy Rate, plus an additional Operational Costs Levy of £0.0028/MWh. That's more than ten times the earlier estimates.

The rates are published quarterly by the LCCC and will continue to rise as the Sizewell C project progresses through its construction phases. By April 2026, the Interim Levy Rate had reached £4.683/MWh.

This matters for businesses because the levy applies to every MWh of electricity consumed, across every site, on every contract. A business using 500 MWh per year will now pay over £2,300 annually just from this one charge — and that figure will keep increasing.

How it shows up on your bill

The Nuclear RAB levy is a non-commodity cost (NCC) - an industry non-power charge sitting alongside things like transmission network charges and the Climate Change Levy.

Most suppliers are either burying the levy inside a broader fixed charge or listing it as a passthrough item without explanation. At tem, the Nuclear RAB levy appears as a named line item on customer bills, at 100% passthrough, so you can see exactly what you're being charged. The rate shown reflects the latest published LCCC actuals, updated quarterly.

What businesses should know

There are a few things worth understanding clearly about how this levy works.

You cannot opt out. The Nuclear RAB levy is a government-mandated charge, applied to all licensed suppliers, who are required to pass it on. It doesn't matter whether you're on a renewable tariff, a fixed contract, or a pass-through arrangement - the levy applies.

The rate will rise. LCCC publishes new forecasts regularly, and the trajectory is upward. The levy is in its interim phase now; as Sizewell C's construction ramps up, so will the rate. Businesses that negotiated contracts before November 2025 may find the levy appearing as a new passthrough item mid-contract - not because their supplier has changed the terms, but because the industry mechanism requires it.

It's separate from the wholesale price. Gas prices, renewable generation, and the wholesale electricity market all affect the commodity portion of your bill. The Nuclear RAB levy sits outside that - it's a fixed industry charge applied regardless of market conditions. Even in a period of falling wholesale prices, this levy will increase.

The lack of transparency is a problem. Because most suppliers don't itemise this charge clearly, businesses have no way of knowing whether the rate they're being charged matches the LCCC-published rate, or whether any margin has been added on top. The published rate for Q2 2026 is £4.683/MWh. If your bill shows a different figure without explanation, it's worth asking your supplier how the number was calculated.

What comes next

Sizewell C's construction timeline runs into the 2030s. The Nuclear RAB Interim Levy will be in place throughout that period, rising as the project progresses. Once the plant is operational, the levy structure changes - but by that point, the financing costs will have been substantially recouped through years of consumer bills.

The government's argument is that this model lowers the overall lifetime cost of nuclear power by cutting the financing premium that investors would otherwise charge. That may be true over a 60-year horizon. In the near term, UK businesses are simply absorbing a new infrastructure charge that is growing every quarter.

Knowing it's there, knowing what it's for, and being able to see it as a named line item on your bill doesn't reduce the cost - but it does mean you're not paying for something you can't explain.

For more on how non-commodity costs work and what makes up the non-wholesale portion of your energy bill, see our breakdown of NCCs. For context on how wholesale gas prices still affect what businesses pay for electricity, see Why do gas price spikes still push up the price of electricity?