Anil Sasi

Differential electricity tariffs are separate tariffs for peak and non-peak hours, with consumers having to shell out a premium for the power consumed during certain designated peak hours.

New Delhi , May 16

CONSUMERS across all States could soon be paying differential electricity tariffs during different hours of the day.

The Electricity Regulatory Commissions of all States have decided to implement time-of-the-day electricity tariffs from the next fiscal (2006-07), starting with bulk users of power.

Time-of-the-day electricity tariffs basically entail having differential tariffs for peak and non-peak hours, with consumers having to shell out a premium for the electricity consumed during certain designated peak hours.

The move to introduce the time-of-the-day tariffs for bulk consumers marks the first step in introducing differential tariffs across all consumer categories, including domestic consumers.

"The step is a major reform since it puts a premium on the amount of power consumed during peak hours by consumers. Besidesbenefits of increased revenues to cash-strapped State Electricity Boards (SEBs), the move to implement time-of-the-day tariffs would rationalise use of electricity during peak hours by bulk consumers, thereby putting the plug on the peaking shortages faced by nearly all States," a Government official said.

The decision was taken collectively by all State Electricity Regulatory Commissions (SERCs) at a recent meeting here. The consensus among the SERCs has been in favour of introducing time-of-day power tariffs in a phased manner starting with industrial and commercial consumers, and then implementing it to other consumer categories, an official said.

Introduction of differential tariffs requires investments by SEBs in having the requisite infrastructure in place, including customised time-of-the-day meters.

Several States, including Tamil Nadu and Kerala, have taken the first step in introducing differential tariffs across the day by installing time-of-day meters for bulk consumers. The Maharashtra Electricity Regulatory Commission (MERC) is working on collating category-wise hourly consumption pattern data as a first step towards the system.

According to industry sources, MERC has asked distribution service providers Reliance Energy and Tata Power to install time-of-day meters for its high tension industrial and commercial consumers, following which low tension industrial and commercial categories will be targeted.

The Tamil Nadu Government is also working on installing meters for high-tension industrial consumers, who will be billed about 20 per cent higher on the energy consumed during peak hours spanning three hours during both mornings and evenings. The Kerala State Electricity Board has taken steps to adopt a differential pricing system to bill high tension consumers using these special meters.

© Copyright 2000 - 2009 The Hindu Business Line