Union government introduced an amendment to the Electricity (Rights of Consumers) Rules, 2020, recently. Through the new change, the government has announced the implementation of a power tariff regime known as time of day (ToD) tariff.
Union Power Minister RK Singh called ToD a win-win situation for the consumers. “Now consumers can plan their consumption in order to reduce their power costs,” the minister was quoted as saying in the official press release.
Currently, consumers in the country are used to fixed electricity rate. The per unit rate of electricity is same during the day and night for most of the consumers. However, the system will change with the introduction of ToD tariffs.
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So what is time of day tariff system and when will it be implemented?
Under the ToD system, electricity rates vary in day and night. According to the government statement, tariff during the solar hours (eight hours duration set by state electricity regulatory commissions) will be 10-20 per cent cheaper than normal tariff while the rate for electricity during peak hours, generally observed in non-solar hours, will be 10-20 per cent higher than normal tariff,
“With awareness and effective utilisation of ToD tariff mechanism, consumers can reduce their electricity bills. Since solar power is cheaper, the tariff during the solar hours will be less, so the consumer benefits,” Union Minister Singh said.
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The government plans to implement the system for commercial and industrial consumers with maximum load of 10 KW and above by April 1, 2024. For domestic consumers, the plan would be implemented latest by April 1, 2025. The government observed in its statement that most of state commissions have already imposed the ToD regime for large commercial and industrial category.
To ensure implementation of the new system, installation of smart meters would be required. Around 20 crore smart meters will be installed by March 2025 under government's revamped distribution sector scheme (RDSS).
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