The Government of India has implemented two changes to the existing power tariff system, aiming to provide cost-saving benefits to consumers. Through an amendment to the Electricity (Rights of Consumers) Rules, 2020, the government has introduced the Time of Day (ToD) Tariff and rationalized smart metering provisions. Under the ToD Tariff system, consumers can save up to 20% on power bills by adjusting their electricity usage during designated solar hours or daytime when the tariff is 10-20% lower than the normal tariff. Conversely, during peak hours, the tariff will be 10-20% higher.

The ToD tariff will initially apply to commercial and industrial consumers with a maximum demand of 10 kW and above from April 1, 2024, and later to all other consumers except agricultural consumers from April 1, 2025. This tariff structure will be activated immediately after the installation of smart meters for consumers who have them.

Union Power and New and Renewable Energy Minister RK Singh expressed that the ToD system benefits both consumers and the power system. It allows consumers to manage their electricity usage according to the tariff structure, effectively reducing their bills. By offering lower tariffs during solar hours when solar power is cheaper, consumers can plan their activities accordingly and lower their costs. Singh also highlighted the positive impact of the ToD mechanism on grid integration of renewable energy sources, which facilitates India’s transition to cleaner energy.

Most State Electricity Regulatory Commissions (SERCs) have already implemented ToD tariffs for large commercial and industrial consumers. The installation of smart meters will extend ToD metering to domestic consumers as well, aligning with the Tariff Policy mandate.

In addition to the ToD Tariff, the government has simplified the rules for smart metering to enhance consumer convenience. Penalties for exceeding the maximum sanctioned load/demand have been reduced, and no penal charges will be imposed based on the maximum demand recorded by smart meters before their installation. The load revision procedure has also been rationalized, allowing upward revisions of maximum demand only if the sanctioned load is exceeded at least three times in a financial year. Smart meters will be read remotely at least once a day, and the data will be shared with consumers, enabling them to make informed decisions about their electricity consumption.

The amendment to the Electricity (Rights of Consumers) Rules, 2020, aligns with the government’s efforts to empower power consumers, ensure reliable 24×7 electricity supply at an affordable cost, and create a favorable environment for power sector investments. The rules emphasize the timely provision of new electricity connections, refunds, and other services, imposing penalties on service providers for willful disregard of consumer rights and mandating compensation for consumers.

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