The Ministry of Power issued the Electricity (Rights of Consumers) Amendment Rules, 2023.14 The Rules specify the rights and obligations of electricity consumers. These pertain to subjects such as standards of service, metering, and payment of bills. The amended Rules mandate the introduction of time-ofday tariffs, i.e., tariffs that vary based on the time of day). It also provides a mechanism for the calculation of bills in case of demand exceeding the sanctioned load. Sanctioned load is the maximum power a distributor has agreed to supply to the consumer.
▪ Time-of-day tariff to be mandatory: The amendments mandate introduction of time-of-day tariffs for retail consumers except for agricultural consumers. Time-of-day tariff implies that tariffs during a single day might be different at different points in time. For example, tariffs may be higher during peak hours and lower during solar hours (when solar energy can be harnessed). This will be effective from: (i) April 1, 2024, for industrial and commercial consumers with maximum demand of up to 10 kilowatts, and (ii) April 1, 2025, for other consumers. For consumers with smart meters, it will be applicable immediately.
▪ Floor for time-of-day tariffs: Time-of-day tariffs will apply to the energy charges. Energy charges are payable based on the total energy consumed in a billing cycle. The time-of-day tariff must not be less than: (i) 1.2 times the normal tariff for industrial and commercial consumers, and (ii) 1.1 times for other consumers. During solar hours, the tariff should be less than the normal tariff by at least 20%. Peak hours must not be longer than solar hours.
▪ Treatment of the sanctioned load for billing purposes: The 2020 Rules mandate the installation of meters. The amendments specify that on the installation of a smart meter, no penalty will be levied in case the actual recorded maximum demand is more than the sanctioned load. For billing, the actual recorded maximum demand will be treated as the sanctioned load. A higher sanctioned load may attract a higher tariff slab.
▪ Revision of the sanctioned load: If the monthly maximum demand exceeds the sanctioned load at least three times in a financial year, the sanctioned load will be revised by the distribution company. The new sanctioned load will be the lowest of the monthly maximum demand. Accordingly, the distribution company may revise the sanctioned load down if the maximum load decreases.
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