Page type: primary-anchored (mirrors Connection and Use of System Code, consolidated 1 April 2026)

The Connection and Use of System Code (CUSC)

The CUSC is one of the 11 GB industry codes governing the electricity system. It is administered by NESO and provides the contractual and commercial framework for connecting to and using the National Electricity Transmission System. Every generator, network operator, supplier, interconnector, and non-embedded customer connected to or seeking connection with the transmission system must be party to the CUSC.

Legal foundation: Electricity Act 1989, s.9; ESO Licence Standard Condition C10.

Current version: Consolidated 1 April 2026 (1,428 pages).

Source file: cusc.md

What the CUSC does

Where the Grid Code sets the technical standards for the system, the CUSC creates the commercial relationships. It answers three questions:

1. Who can connect and on what terms? (Sections 1-2, 16-18) -- the connection application process, bilateral agreements, Connect and Manage, queue management
2. What does everyone pay? (Section 14) -- the three charging methodologies: connection charges, TNUoS (Transmission Network Use of System), and BSUoS (Balancing Services Use of System)
3. What services must generators provide? (Section 4) -- mandatory ancillary services (reactive power, frequency response), other balancing services, payment terms

Structure at a glance

Bold = sections covered in detail below.

Section 2: Connection

Section 2 governs the physical connection of Users to the NETS. It has three Parts:

Part I -- General sets out the fundamental connection rights and obligations: - Users have the right to remain connected once Commissioned (2.2.1) and the obligation to stay connected until Disconnection is permitted (2.2.3) - Generators must not exceed their Transmission Entry Capacity (TEC) or Connection Entry Capacity (CEC) (2.2.4, 2.3.2) - NESO must accept power up to TEC (2.3.1) and transport power to demand sites up to Connection Site Demand Capability (2.4) - The electrical ownership boundary between User and transmission licensee is defined in precise physical terms: busbar clamps for air-insulated, busbar shutters for metal-enclosed, gas zone separators for GIS switchgear (2.12.1) - New connections require a Connection Application; Gated Applications follow the Gate process in Sections 16-18 (2.13.1)

Part II -- Connection Charges (2.14-2.18) covers annual connection charges, revision of charges, and termination amounts.

Part III -- Credit Requirements (2.19-2.22) covers security for termination amounts, credit rating thresholds, and types of acceptable security (Performance Bonds, Letters of Credit, cash deposits).

Section 4: Balancing Services

Section 4 governs the procurement and payment of balancing services:

• Mandatory Ancillary Services (4.1): generators required by the Grid Code to provide reactive power (Obligatory and Enhanced Reactive Power Service) and frequency response must comply with the CUSC payment terms and Schedule 3 methodology
• Maximum Generation (4.2): arrangements for generators to provide maximum output when instructed
• System to Generator Operational Intertripping (4.2A): arrangements for intertrip schemes
• Other Balancing Services (4.2B): commercial balancing services beyond mandatory requirements
• Payments and Indexation (4.3-4.5): payment mechanisms and inflation adjustment

The detailed reactive power methodology, including formulae for converting capability between stator terminals and the Commercial Boundary, is in Schedule 3.

Section 14: Charging Methodologies

Section 14 is the most commercially significant part of the CUSC at 149 pages. It contains three distinct charging methodologies:

Connection Charging Methodology (Part 1, 14.2-14.13)

The key principle is that connection charges recover the cost of single-user assets with a reasonable rate of return (14.2.1), and must not discriminate between Users (14.2.3).

The connection/infrastructure boundary (14.2.5-14.2.9) determines what is charged to individual Users versus socialised through TNUoS: - Connection assets = those solely required for an individual User, not used or normally usable by any other party - Three physical rules define the boundary: double busbar bay, teed/mesh to HV disconnector, cables at transmission voltage <=2km

TNUoS Methodology (Part 2 Section 1, 14.14-14.29)

The Transmission Network Use of System charging methodology uses a DC load flow transport model to produce locational zonal signals: - Generation charges are zonal and can be positive (generator pays) or negative (generator receives credit) depending on whether the generator is in an area that increases or reduces system constraints - Demand charges are also zonal, based on the incremental cost of transporting power to each zone - A Stability & Predictability mechanism (14.29) caps year-on-year tariff changes to limit volatility

BSUoS Methodology (Part 2 Section 2, 14.30-14.32)

BSUoS recovers the daily costs of balancing the system in real time, allocated to generators and suppliers based on metered volumes.

Connect and Manage (Section 1.4)

Connect and Manage allows generators to connect and export power before all system reinforcement works triggered by their connection are complete. Offers to generators in categories 1.4.1(a)-(c) "shall be offered on the basis of the Connect and Manage Arrangements." This policy mechanism, introduced around 2010, accelerates connections but can increase constraint costs borne through BSUoS.

User categories

The CUSC recognises 12 categories of User (Section 1.2.4), each with different applicable Sections:

1. Power Station directly connected to NETS (Sections 2, 3, 15, 16)
2. Non-Embedded Customer Site (Section 2, 16)
3. Distribution System directly connected (Section 2, plus 15/16 where applicable)
4. Suppliers (Section 3 only)
5. Embedded Power Station, not BELLA (Section 3, plus 15 where BEGA)
6. Small Power Station Trading Parties (Section 3 only)
7. Interconnector User (Section 9 Part II only)
8. Interconnector Error Administrator (Section 9 Part II only)
9. Interconnector Owner (Section 9 Part I, 15, 16)
10. Distribution Interconnector Owner (Section 3 only)
11. Embedded Exemptable Large Power Station (SMRS/CMRS) (None)
12. Virtual Lead Party (Section 3 only)

All categories must comply with Sections 1, 5-8, 11, and 14.

Governance

Changes to the CUSC are made through the CMP (CUSC Modification Proposal) process managed by the CUSC Modifications Panel (Section 8). Ofgem has final approval. Standing industry forums include: - Transmission Charging Methodologies Forum (TCMF) -- reviews charging issues - CUSC Issues Steering Group (CISG) -- manages code issues

Relationship to other instruments

The CUSC sits within a cluster of four NESO-administered codes: - Grid Code -- technical standards (the CUSC references Grid Code requirements throughout) - CUSC -- commercial and contractual framework (this page) - SQSS -- network planning and security standards (referenced in TNUoS methodology) - STC -- SO-TO interface (ownership boundaries, Interface Agreements, offshore reactive power)

The CUSC also interfaces with: - BSC -- settlement and credit provisions - Electricity Act 1989 -- statutory basis for connection, use of system, and modification powers - ESO Licence -- condition C10 requires NESO to maintain the CUSC

Defined terms

The full defined terms register (Section 11, 97 pages) is in the source file.

Character positions

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Debate

No secondary-source commentary linked yet.

Last updated: 2026-04-05