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As well as staff time, reasonable costs may include the necessity of buying new equipment or software; travel required to retrieve the information, etc.
Time taken to consider whether exemptions apply or to redact parts of the information, should not be included in the calculation of costs used to apply a Section 12 exemption (see points 14 and 15 of this ICO guidance PDF).
Request an internal review now, or continue answering questions to see whether you have any additional grounds to strengthen your case.