Friends, today in this article we will learn about tariff. I am going to give you information about all this in a very good way. So let’s start.
Tariff
The electricity companies determine the terms and conditions for charging electricity rates from the consumers. These terms and conditions are called tariff, that is, the mode of payment for the electricity consumed by the consumers is called tariff.
Electricity producers try to reduce electricity rates. These rates are determined according to the needs of each consumer. While determining the tariff, it is kept in mind that the cost incurred in electricity production can be fully recovered.
While determining the tariff, it is also to be kept in mind that profit should be earned in addition to the cost price. This profit is included in the employees and other charges of the power supply plant. Since India is a developing country, the percentage of profit should be minimum. = On the basis of tariff, the power companies make plans for future expansion by earning profit.
While preparing the tariff the following points should be kept in mind-
- The tariff should be easily acceptable to all consumers.
- The tariff should be designed in such a way that it is acceptable to all types of consumers i.e., both low load and high load consumers.
- The tariff should be simple and easy to understand by the consumers.
- There should be such provision for the consumer that he can maximize the use of electricity during off-peak hours.
- The tariff should provide equal benefits to both the supplier and the consumer.
- The tariff should be affordable which can be used by every consumer.
- Through the tariff, the electricity supplier must receive a fixed amount as charges from the electricity consumer.
- Tariffs should be designed in such a way as to encourage consumers.
- Electricity supply companies should fix tariffs separately for high load consumers (factories, hospitals). Due to higher energy consumption in these, the rate per unit of energy should be kept low.
Objective of Tariff
The main purpose of tariff determination is to obtain electricity consumption expenditure (cost) from consumers. It is used by electricity companies in the construction of power substations and an attempt is made to reduce the cost price. The cost is determined on the basis of different types of tariffs. If the demand by the consumer is maximum, then its tariff will be determined on the basis of maximum demand while the power generation center is constructed on the basis of this demand. Two types of charges are received as cost through tariff-
- Annual Fixed Fee
- annual running charges
Annual fixed charge is the charge of a generating station which includes machinery, plant structure etc. Annual fixed charge is collected with a fixed amount. It does not create a variable effect on the cost. Annual floating charge is a variable cost under which the floating charge of the tariff is changed when there is a change in the prices of energy sources.
For example, if the cost of coal used as a source of energy in a thermal power plant is high or the transportation rate is high, the annual running charge is high. This charge is included in the bills of consumers.
Important Components of Tariff Determination
The following are the important factors in determination of tariff:
- Nature of electrical load
- Weighting coefficient
- coefficient of diversity
- Amount of load
- Electrical energy consumed by the consumer (in units)
- Maximum demand or peak demand coefficient
- load time
- annual fixed cost
- Power factor of load
- Incentives to consumers
- Annual running cost
- Method of formulating tariff
- Encouraging consumers to consume electricity during off-peak hours
What did you learn today :-
Now you must have known about Tariff and you must have got the answer to all these questions very well.
I hope you liked the information given by me, if you have any question/suggestion in your mind, then you can tell me by commenting below, I will definitely reply to your comment. If you liked this post, then you can also share it with your friends and relatives.