Seminar

on

Various Types of Power

Tariff in India
Presented By,
Ambreesh Kumar Singh(111504)
Lalat Sankar Nayak (111518)

Contents

What is Power Tariff?

Objective of Tariff
Regulation for Tariff Fixation
General Tariff Form
Types of Power Tariff in India
Conclusion

What is Power Tariff?

Electric utilities drive their income
from customers through electricity
bills hence different methods of
charging the customers are known as
tariff.

Objectives of Tariff

Regulations for Tariff

Fixation
Electric energy must be made available
instantly on demand.
Electric supply authorities have jurisdiction
only up to the electricity meter.
Since it is a monopoly business, it has to
be subjected to government control
specially as regards fixation of tariff.
The electric supply authorities directly sale
the commodity to the consumer.
The quality of service.

General Tariff Form

Quite a large number of tariffs have
been proposed from time to time and
are in use. They are all derived form
the following equation:
A= cx + dy + f

Where,
A= total amount of bill for a certain period (say one month)
x= maximum demand during the period (kW or kVA)
y=total energy consumed during the period (kWh)
c=unit charge for maximum demand, Rs. per kW(or Rs. per kVA)
d=unit cost of energy, Rs. Per kWh.
f=constant charge, Rs.

Types of Tariff Plan

Flat demand rate

Straight meter rate
Block meter rate
Hopkinson demand rate
Doherty rate
Write demand rate
Spot Pricing (T.O.D)

Flat Demand Rate

The flat demand rate can be expressed
in the form,
A= cx
The bill depends only on the maximum
demand irrespective of the amount of
energy consumed.
The cost of metering equipment and
meter reading is eliminated by the use
of this form of tariff.

Straight Meter Rate

This can be represented by the equation:
A= dy
The charges depend on the energy used.
This tariff is sometimes used for residential
and commercial customers.
Advantage: Simplicity
Disadvantages:
A customer who does not use energy has zero bill through
he has caused the utility to incur a definite expenditure
due to its readiness to serve him.
This method does not encourage the use of electricity.

Block Meter Rate

This meter rate charges the customers on a
sliding scale and it can be expressed in the
form:

Generally the charge and energy consumption

are divided into three blocks,
A high rate for initial units
A lower rate for next units
A still lower rate for the remaining units.

Hopkinson demand rate

This tariff , also known as two part tariff,
can be expressed in the form

This tariff is used for industrial customers.

Disadvantage: Problem of measuring the
max. power demand of the customers.

Doherty rate
This rate, also known as three part tariff,
extends the two part tariff by adding a
constant term as

This tariff
customers.

is

suitable

for

industrial

Wright demand rate

Wright demand rate intensifies this
inducement by lowering both the demand
charge and energy charge for a reduction
in maximum demand i.e. an improvement
in load factor.
This tariff is generally specified for those
industrial customers who have a control
over their maximum demands

Spot Pricing
This encourages the customer to reduce his energy
requirement at times of peak load and use more
energy when supply is abundant and prices are low.

The spot
pricing rate

Incremental
operating
cost

Quality of
supply
component

Contd.

 Partial spot pricing in the industries and

commercial rate structures is also known
as Time of Day Tariff.
TOD: This tariff design features electricity
tariffs that vary by time period, being
higher in peak periods and lower in offpeak period. The simplest TOD tariff can
be structured as a two period tariff, a
peak period and an off-peak period.

Contd.

Relationship between Risk of Consumer and utility

Conclusion
Power tariff plays an important role
in the economical strategy of any
country, hence it is very essential
design the appropriate structure of
tariff plan. At the same time the
plans should able to maintain
balance among all the types of
customers.