Rising energy costs under new nuclear levy
Stuart McKay · Posted on: November 21st 2025 · read
A new levy introduced on electricity suppliers from 01 November 2025 is expected to increase costs for many charities, reported sector news outlet Civil Society recently.
The charge, created under the Nuclear Energy (Financing) Act 2022, funds the construction of the Sizewell C nuclear power station through a regulated asset base (RAB) model. Suppliers must pay the levy and recover it from customers, meaning charities will likely see higher bills from this Winter.
Social Investment Business (SIB) has estimated the charge at approximately £3.46 per megawatt hour (MWh) of usage. While this may seem small, the cumulative effect could add between £100 and £2,500 to the annual energy bills of charities, depending on their size and usage.
The overall cost to the sector could exceed £2 million annually.
Rising energy prices remain a significant concern, especially for small community groups and volunteer-led organisations that operate from older, less energy-efficient buildings.
Sector leaders warn that the levy risks diverting limited funds from front-line services and may undermine environmental goals. Kate Ward of Bristol arts charity Spike Island cautioned that the extra costs would make it harder to maintain programmes and meet sustainability ambitions. Similarly, Beth Wilson, CEO of Wellspring Settlement, said the levy would directly impact services for local families. SIB’s Chief Executive, Nick Temple, described the funding model as 'no longer fit for purpose', arguing it penalises essential community spaces at a time of rising demand.
The Government has defended the measure, noting that business rates relief has been extended for charities and that investment in clean energy will reduce long-term costs. However, charities continue to feel the pressure of energy inflation more acutely than households, which benefit from price caps. For now, organisations should review their contracts, explore fixed-tariff options, and invest in energy efficiency improvements where possible. Proactive budgeting and engagement with umbrella bodies on advocacy efforts could also help mitigate the financial burden.
"While nuclear investment supports national energy security, its costs are being felt now. Charities should plan for this additional overhead as part of broader financial resilience strategies heading into 2026."
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