In late 2025, you may have noticed a new line that appeared on your UK electricity bill. It’s called the ‘Nuclear RAB levy’ and is approximately £1 per month for households and variable for businesses, depending on usage. This change is closely tied to the Nuclear RAB model, and reflects shifts in UK energy prices 2025.
This is the first step in a much bigger transformation in the way the UK pays for nuclear power and manages Nuclear energy UK. The government intends to build new nuclear stations, starting with Sizewell C. New nuclear is expensive, slow-moving and risky, which has put off many private investors. The Nuclear RAB model is designed to change that and is part of broader Energy policy UK.
The Nuclear RAB model takes a small portion of the construction cost from all consumers, and in return the UK has a low carbon source of energy at a price that is flat and reliable for the decades. This blog will clearly explain the model and show how it will affect your Energy bills UK 2025 and beyond within the broader UK energy market 2025.
The Nuclear Regulated Asset Base (RAB) model is a public-supported financing structure that affords nuclear developers a regulated, stable stream of income during construction. This approach is a significant departure from the previous Contract for Difference (CfD) model, under which developers saw income only once the plant was operational and electricity was generated. This section serves as the RAB model explained foundation for readers.
Nuclear stations typically take 10–12 years to build, and investors consider the construction of nuclear stations to be a high-risk investment. The Nuclear RAB model mitigates that risk by allowing the developer to recover some project costs earlier in the development process. Funding for the RAB model is raised through a modest levy on electricity bills in the UK, directly linked to Energy bills UK 2025.
The first project to use the RAB is Sizewell C in Suffolk, a key part of long-term Nuclear energy UK planning.
Several nuclear ventures failed over the last decade because investors would not or could not accept the costs and uncertainties. Wylfa Newydd and Moorside are case studies. Hinkley Point C progressed under the CfD model, but not without offering a highly elevated long-term price.
The government sought a new approach to bring nuclear technology to market in an economically viable manner, aligning with broader Energy policy UK and stabilising UK energy prices 2025.
• reduced the costs on financing
• access to private investment
• reduction in construction time
• security of UK energy supply over the medium – long term
This is a way to avoid years of stalled nuclear development and reshape the UK energy market 2025.
The levy will show up on bills in November/December 2025. It will appear on bills as a non-commodity charge, separate from energy usage.
Households will incur an estimated cost of around £1 or so a month while they are under construction, adding directly into rising Energy bills UK 2025.
Business costs will vary based on their electricity usage so companies which use high levels of electricity will pay more.
Some industries will also not be required to pay the levy if they hold a valid exemption certificate, under government rules. These industries are called Energy Intensive Industries (EIIs) and include steel, glass, and chemicals.
There are two primary organisations running the scheme:
Ofgem
• Regulates the model
• Determines the allowed revenue for developers
• Ensures protection for consumers
Low Carbon Contracts Company (LCCC)
• Collects the levy from electricity suppliers
• Transfers the money to the licensed nuclear company
The aim of this structure is to make the process more manageable and visible while supporting the structure of the Nuclear RAB model within the evolving UK energy market 2025.
The amount collected is used for several items:
• pricing a part of the construction cost of Sizewell C
• protecting against financing costs that would otherwise have been rated greater
• infrastructure and grid connection upgrades that would be required
• risk-sharing mechanisms to make nuclear viable again
In layman’s terms: Households are paying a small amount now, so they are able to live with less cost pressure later, especially as UK energy prices 2025 shift under new Energy policy UK.
The effect changes over time. The levy causes bills to rise by a small amount ahead of inflation in the short run. But in the medium and long term, nuclear limits exposure to gas price shocks and produces reliable, low-carbon energy to support the gas-dominated wholesale market.
Below is the only table in this revised version:
| Time Period | Effect on Energy Bills | Why It Happens |
| 2025–2030 | Small increase | RAB levy is added during nuclear construction |
| 2030–2040 | Greater stability | New nuclear capacity reduces reliance on gas |
| 2040–2085 | Long-term affordability | Nuclear provides predictable, low-carbon baseload |
This demonstrates how the Nuclear RAB model stabilises long-term Energy bills UK 2025 and beyond.
Even though the levy itself cannot be avoided (unless exempt), businesses can still protect themselves:
These actions are especially relevant as the UK energy market 2025 continues to evolve.
More than any other sector, hotels, pubs, and venues are significantly affected.
Example: A 50-room boutique hotel in London using 500,000 kWh may see £300–£450/mo added.
These facilities cannot reduce usage meaningfully.
Example: A clinic in Leeds using 120,000 kWh/year may see £80–£120/mo added.
HVAC-heavy operations increase levy exposure.
Example: A Manchester gym using 250,000 kWh may see £150–£250/mo added.
Refrigeration and cooking equipment drive consumption.
Example: A Birmingham restaurant using 18,000 kWh/year may see £12–£18/mo added.
Households face a modest ~£1 monthly increase under Energy bills UK 2025.
Example: A typical UK home using 3,200 kWh/year sees the standard monthly charge.
E for Energy assists businesses in understanding and mitigating non-commodity items like the levy.
• Analyse RAB impact
• Examine contracts
• Forecast DUoS/TNUoS
• Identify exemptions
• Optimise multi-site procurement
This is crucial within the context of broader Energy policy UK and the shifting UK energy market 2025.
The Nuclear RAB model represents a major shift in how the UK builds and finances nuclear power. It introduces a small cost starting in 2025 but is designed to improve long-term price stability within Nuclear energy UK.
Businesses that prepare early can make smarter decisions as UK energy prices 2025 evolve. For clear advice on how the levy affects your sites, E for Energy can provide a no-obligation review.