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Government Amends Electricity Rules and Introduces ToD Tariff

Under the ToD Tariff system, tariff during solar hours of the day shall be 10 -20 percent less than the normal tariff, while the tariff during peak hours will be 10 to 20 percent higher.

June 23, 2023. By Anurima Mondal

The Government of India has introduced two changes to the prevailing power tariff system, through an amendment to the Electricity (Rights of Consumers) Rules, 2020. The changes are: introduction of Time of Day (ToD) Tariff, and rationalisation of smart metering provisions.

Rather than being charged for electricity at the same rate at all times of the day, the price you pay for electricity will vary according to the time of day. Under the ToD Tariff system, tariff during solar hours (duration of eight hours in a day as specified by the State Electricity Regulatory Commission) of the day shall be 10-20 percent less than the normal tariff, while the tariff during peak hours will be 10 to 20 percent higher.

ToD tariff would be applicable for Commercial and Industrial consumers having Maximum demand of 10 KW and above, from April 1, 2024 and for all other consumers except agricultural consumers, latest from April 1, 2025. Time of Day tariff shall be made effective immediately after installation of smart meters, for the consumers with smart meters.

Power Minister R.K. Singh said that the ToD is a win-win for consumers as well as the power system. “The TOD tariffs comprising separate tariffs for peak hours, Solar hours and normal hours, send price signals to consumers to manage their load according to the Tariff. With awareness and effective utilization 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. During non-solar hours thermal and hydro power as well as gas based capacity is used – their costs are higher than that of solar power – this will be reflected in Time of Day Tariff. Now consumers can plan their consumption in order to reduce their power costs – planning more activities during solar hours when power costs are less,” he said.

Most of the State Electricity Regulatory Commissions (SERCs) have already implemented ToD tariffs, for large Commercial and Industrial (C&I) category of consumers in the country. With installation of smart meters, the ToD metering at domestic consumer level will be introduced as per Tariff Policy mandate.

The government has also simplified the rules for smart metering. As per the amendment in metering provision, post installation of a smart meter, no penal charges will be imposed on a consumer based on maximum demand recorded by the smart meter for the period before installation date. Load revision procedure has also been rationalised in a way that maximum demand shall be revised upwards only if sanctioned load has been exceeded at least three times in a financial year. Moreover, smart meters shall be read remotely at least once in a day and the data shall be shared with consumers in order to enable them to take informed decision about consumption of electricity.

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Policies & Regulations

Time of Day Tariff

State Electricity Regulatory Commission

Solar Hours

Electricity (Rights of Consumers) Rules, 2020