Tariff is the way of billing energy consume by consumer OR the rate at which electrical energy is supply to a consumer it is known as tariff.
List the objectives of Tariff
All expenses like interest and depreciation (I &D) i.e recovery of cost of producing electrical energy at the generating station.
Interest & Depreciation on capital investment made on T&D line.
Recovery of cost of operation and maintenance of supply of electrical energy.
T&D losses also considered while calculating tariff.
We should also think that electricity cannot be stored (not economically). It has to be consumed as soon as it is generated while calculating tariff.
We should also think about investment required for future expansion.
A reasonable profit should be added while calculating tariff
Requirement of Tariff
It should be easy to understand to consumer.
Easy to calculate.
Tariff should be attractive; It should not be too high or too low. It should be reasonable.
Tariff should be economical as compare to other types of energy sources.
Tariff must be fair, so that different types of consumers are satisfied with rate of electrical energy charges.
Tariff should be formed into two parts i.e fixed charge & running charge
While calculating tariff it should cover
Types of Tariff
i) Flat-demand Tariff (ii) Simple-demand Tariff or Uniform Tariff (iii) Flat-rate Tariff (iv) Step-rate Tariff (v) Block-rate Tariff (vi) Two-part Tariff: (vii) Maximum demand Tariff (viii) Three-part Tariff (ix) Power factor Tariff :- a) KVA maximum demand Tariff b) Sliding Scale Tariff or Average P.F. Tariff c) KW and KVAR Tariff (x) TOD (Time of Day) Tariff
Flat Demand Tariff:
It is used where energy consumption is fixed per day i.e where load is fixed and is used for fixed hours.
E.g. Street lighting, Road Signal system and advertising board.
In this type no energy meter is connected, so meter reading, billing, accounting, Stationary, bill distribution and collection etc expenses are eliminated and also save time for billing.
Simple or uniform demand tariff:
In this type of tariff cost of energy charges is calculated on the basis of actual energy Consume energy meter is connected in consumer premises.
Flat Rate Tariff:
In this type of tariff there are two energy meter in one premises.
One energy meter is for lighting circuit load and another meter is for power circuit load.
Tariff rate for lighting and power load are different.
Tariff rate for lighting is higher than tariff for power load. Disadvantages
Two energy meter are required in one premises
Hilling stationary expenditure
Step rate Tariff:
In this tariff there are steps for unit’s consumption and cost/unit is less for more consumption of unit.
The main disadvantage of this tariff is that the consumer unnecessary wastes the power to enter the next stage.
For example
1) Step- I- Rs.2/KWH :- If consumption not to exceed 50 unit
2) Step-II – Rs. 1.75/KWh:- If consumption not to exceed 200 unit.
3) Step-II- Rs. 1.50/KWh:- If consumption exceeds above 200 units.
Disadvantages
The main disadvantages of this tariff is that the consumer unnecessary waste the power to enter next step.
Block Rate Tariff:
In case of block rate tariff there are blocks of units consumed and each block tariff rate/unit (KWH) is different.
If generation is less than utilization than tariff rate/unit in each block goes on increasing and vice versa.
Two Part Tariff:
In this type of tariff energy bill is split into two parts.
Only one energy meter is used to measure no. of units consumed it recovers a fixed charge which depends on load (KW).
This type of tariff system is used for residential and commercial consumers.(up to 20 KW
This type of tariff is not used for industrial consumers.
ENERGY BILL= FIXED CHARGE +RUNNING CHARGE
Advantages
it recover fix charges which depend on connected load so it automatically recover capital investment of supply company
Disadvantage
The consumer has to pay fix charges per month whether he has to consume or not consume the electrical energy
Maximum Demand Tariff/KVA MD Tariff:
It is similar to two part tariff except that maximum demand (KVA) is actually measured by Installing maximum demand (in KVA)
M.D. Meter is installed in the premises of consumer, in addition to energy meter.
Industrial consumer is trying to improve power factor to reduce maximum demand charges.
This type of tariff is applicable to industrial consumer/H.T. consumer
Three part Tariff:
Fixed charges per month depend on connected load.
This type tariff is used for HT consumer.
ENERGY BILL= FIXED CHARGE+SEMI-FIXED CHARGE+RUNNING CHARGE
Power Factor Tariff:
The tariff in which P.f. of industrial consumer is taken into consideration.
Power factor tariff is used for industrial consumer /H.T. consumer.
If the P.F. of consumer is less than P.F. declare by Supply Company (say below 0.92lag.) than penalty will be charged in energy bill.
If The P.F. of consumer is more than P.F. declare by supply company (say above 0.96 lag.) than discount will be given in energy bill.
Time of Day (TOD) Tariff or OFF-load Tariff:
TOD energy meter is installed in the HT consumer premises.
If the P.F. of consumer is less than P.F. declar by supply company (say below0 .92lag.) than penalty will be charged in energy bill.
This meter is specially designed to measure energy consumption w.r.t time.
This type of tariff is such that energy consumption charges/unit are less during OFF-load period
There is a higher tariff rate energy consumption charge during peak-load period.
This type of tariff is introduced to encourage industrial consumers to run their maximum load during OFF-load period.
Such type of tariff is used for HT consumer
Suitable Tariff for Consumer
Domestic consumer
Domestic consumer are given single phase supply up to 5 kw & a three phase supply for loads exceeding 5 kw
The tariffs applicable to domestic consumer are simple tariff, flat rate tariff or block rate tariff.
In addition meter rent & electricity duty are also charged from the consumers.
Commercial Consumer
Commercial consumer are given single phase supply up to 5 kw & a three phase supply for loads exceeding 5 kw
The tariffs applicable to commercial consumer are simple tariff, flat rate tariff or block rate tariff but charges per unit are higher in comparison to those in case of domestic consumer.
Agricultural consumer
Consumer drawing power up to 20 kw for irrigation pumping units are categorized as agricultural consumer.
Agricultural consumer are charged at a flat rate tariff which may be either on fixed charge per unit or fixed charge per KW or HP of connected load
Industrial consumer
Small industrial consumer
Industrial consumer with load not exceeding 20 kw under the category of Small industrial consumer
Small industrial consumer are given three phase supply at 415v. A block tariff is usually offered to such consumer
Medium industrial consumer
Industrial consumer with load lies between 20kw to 100kw under the category of Medium industrial consumer
They are given three phase supply at 415 v & usually charged on Two-part tariff.
Large industrial consumer
Industrial consumer with load exceeding 100 kw under the category of Large industrial consumer
Such consumer are usually charged KVA demand Tariff
Bulk consumer
Bulk consumer are usually supplied by 3 phase supply at 415v or 11kv depending on their requirement.
Such consumer are charged at flat rate
Street lighting
Supply for street lighting is given at 415v three phase or 230v single phase.
Street lighting are charged at a flat rate