Lok Sabha Question No. 41 (UNSTARRED), answered on 2023-07-20
Subject: Power Tariff System
Ministry: POWER
Asked by: DNV Senthilkumar. S., Amol Ramsing Kolhe, Kuldeep Rai Sharma, Subhash Ramrao Bhamre, Supriya Sadanand Sule

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.41 ANSWERED ON 20.07.2023

## POWER TARIFF SYSTEM

41. DR. DNV SENTHILKUMAR S.:

DR. SUBHASH RAMRAO BHAMRE: SHRI KULDEEP RAI SHARMA: SHRIMATI SUPRIYA SULE: DR. AMOL RAMSING KOLHE:

Will the Minister of POWER be pleased to state:

- (a) whether per unit rate of electricity is same during all time of the day for the consumers;
- (b) if  so,  whether  the  Government  proposes  to  bring  changes  in  the prevailing power tariff system by which prices paid by consumers for electricity would vary according to the time of day;
- (c) the  main  features  of  ToD  Tariff  system  being  introduced  by  the Government;
- (d) the  advantages  that  would  accrue  to  consumers  as  a  result  of  ToD Tariff system;
- (e) whether  the  Government  has  launched  any  awareness  campaign  for consumers  regarding  ToD  tariff  so  that  they  could  reduce  their  electricity bills and if so, the the details thereof; and
- (f) the time by which the ToD Tariff system would be made applicable?

## A N S W E R

## THE MINISTER OF POWER AND NEW & RENEWABLE ENERGY (SHRI R.K. SINGH)

- (a) to (c) : The tariff including the Time of Day (ToD) tariff by the distribution licensees to its consumers is as approved by the Appropriate Commission for that particular category of consumer. In most of the States the ToD tariff is applicable for Commercial and Industrial consumers. In some of the States ToD Tariff is applicable for other e.g. domestic and agricultural consumers also.

Ministry  of  Power  vide  notification  dated  14.06.2023  has  issued  the Electricity  (Rights of  Consumers) Amendment Rules, 2023 wherein the rule for  Time  of  Day  (ToD)  Tariff  has  also  been  specified.  The  main  features  of these Rules are as under:

- ToD tariff  for  Commercial  and  Industrial  consumers  having  maximum demand more than 10kW shall be made effective from a date not later than  1st  April,  2024  and  for  other  consumers  except  agricultural consumers,  the  ToD  tariff  shall  be  made  effective  not  later  than  1st
- i. April, 2025.
- ii. ToD  tariff  shall  be  made  effective  immediately  after  installation  of
- smart meters for the consumers.
- iii. ToD  tariff,  during  the  peak  period  of  the  day,  for  Commercial  and Industrial consumers shall not be less than 1.20 times the normal tariff and for other consumers it shall not be less than 1.10 times the normal tariff.
- iv. Tariff  for  solar  hours,  of  the  day,  to  be  specified  by  the  State Commission  shall  be  at  least  twenty  percent  (20%)  less  than  the normal tariff for that category of consumers.
- ToD  tariff  shall  be  applicable  on  energy  charge  component  of  the
- v. normal tariff.
- (d)  : The advantages for use of ToD tariff system to consumers  are as follows:
- i. The ToD tariff comprising  separate tariffs for peak hours, solar hours and normal hours, sends price signals to consumers to manage their load  in  accordance  with  the  Tariff.  Since,  the  tariff  during  the  solar hours will be at least 20% less than the normal tariff, the consumer can shift    consumption   during  solar  hours  when  power  cost  is    less  and can be benefitted.
- ii. With  awareness  and  effective  utilisation  of  ToD  tariff  mechanism, consumers can reduce their expenditure on electricity consumption.
- iii. It  optimizes  generation  capacity,  helps  utilities  in  maintaining  loadgeneration  balance  and  in  reducing  financial  burden  for  arranging costly power to meet peak load, which ultimately would be beneficial
- to the end consumers.

- iv. It also  improves the management of renewable generation fluctuations and  incentivises  more  consumption  during  the  periods  of  Renewable Energy  generation,  thereby  providing  benefits    to  consumers  with availability of reliable and cleaner power at reasonable rates.

(e) & (f) :   Ministry  of  Power  has  taken  proactive  measures  to  ensure widespread awareness of the Time of Day tariff rules. By circulating these Rules to all the stakeholders including all States/UTs vide letter dtd. 16.06.2023 and through press release dtd 23.06.2023, the Ministry aims to  reach  common  people  and  educate  them  about  the  benefits  and implications  of  this  new  tariff  structure.  Under  the  new  tariff  structure, effective  from  a  date  not  later  than  1st  April  2024,  Commercial  and Industrial  consumers  with  a  maximum  demand  exceeding  10kW  will  be eligible  for  the  Time  of  Day  tariff.  Similarly,  for  all  other  consumers, excluding  agricultural  consumers,  the  ToD  tariff  will  be  implemented  not later than 1st April, 2025.

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