Ministry of Power has recently implemented Time-of-Day (ToD) tariff for Electricity

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July 4, 2023

Ministry of Power has recently implemented Time-of-Day (ToD) tariff for Electricity

The introduction of Time-of-Day Tariff: A game changer for electricity consumers and the power sector


  • The Ministry of Power has recently implemented Time-of-Day (ToD) tariff for electricity, a significant change in the power sector. This article aims to explore the concept of ToD tariff, its impact on consumers, and its importance for the power sector. By understanding this new tariff structure, consumers can regulate their electricity consumption and control their bills while benefiting the power sector in terms of efficiency and sustainability.

Understanding Time-of-Day Tariff:

  • ToD tariff replaces the traditional flat rate system and introduces variable electricity charges based on the time of day. During daytime, consumers can expect a decrease in tariffs of up to 20%, providing them the opportunity to save on their bills. Conversely, during night-time, the tariff will increase by the same amount, encouraging a shift in power consumption patterns.

Impact on Electricity Bills:

  • The implementation of ToD tariff will have varying effects on different households. Small working couples who primarily utilize electricity during the night may experience an increase in their bills. However, households with flexibility can offset the increased nighttime charges by shifting some of their electricity usage to the daytime, taking advantage of the lower tariffs.

Managing Power Consumption Patterns:

  • ToD tariff aims to discourage excessive power consumption during peak hours, which typically occur in the morning, late afternoon, and early evening. By incentivizing consumers to adjust their electricity usage habits, the power sector can manage the demand more effectively and reduce strain on the grid.

Identifying Power-Guzzling Appliances:

  • Certain appliances, such as air conditioners, coolers, refrigerators, heaters, and geysers, contribute significantly to household electricity consumption. However, energy-efficient alternatives are available for most of these appliances, which can help reduce overall electricity usage and mitigate the impact of ToD tariffs on bills.

Readiness of Infrastructure:

  • The successful implementation of ToD tariff relies on the availability of smart meters. These meters automate meter readings, provide accurate cost estimations, and send consumption data to power distribution companies every 15 minutes. Currently, over 6.5 million smart meters have been installed, with a target of reaching 250 million by 2026.

Benefits for the Power Sector:

  • ToD tariff and smart metering offer numerous advantages to the power sector. They enhance billing efficiency, reduce transmission and distribution losses, and facilitate the blending of renewable and coal-based power through differential tariff structures. Additionally, ToD tariff encourages consumers to charge electric vehicles during off-peak hours, reducing the strain on the power grid.

The Conclusion:

  • The introduction of Time-of-Day tariff is a transformative step in the power sector, offering benefits for both consumers and the industry as a whole. By allowing consumers to regulate their electricity consumption and control their bills, while also promoting efficiency and sustainability, ToD tariff represents a significant advancement towards a more optimized and responsive power system.

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Ministry of Power has recently implemented Time-of-Day (ToD) tariff for Electricity | Vaid ICS Institute