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WELCOME
TO
EED511
ELECTRICAL DESIGN AND POWER UTILIZATION
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Topic 1 - TARIFFS
The rate at which the electrical energy is supplied to the consumer is known as Tariff
Tariff must include the total cost of producing and supplying
electrical energy + profit
Tariff depends upon the load condition and the magnitude of
electrical energy consumed by the consumers (not same)
Industrial, domestic, commercial, etc.
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Objectives of Tariff
Recovery of cost of producing electrical energy at the
power station
Recovery of cost on the capital investment in transmission
and distribution system
Recovery of cost of operation and maintenance of
supply of electrical energy (metering, transformer,
lines)
A suitable profit on the capital investment
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Characteristics of a Tariff
1. Proper return – Total receipt from the consumers must
be equal to the cost of producing and supplying
electrical energy plus reasonable profit.
2. Fairness – Consumers satisfaction with the rate,
differentiation of pricing based on demand.
3. Simplicity – Complicated Tariff is not good for the
public
4. Reasonable profit
profit element must be reasonable
monopoly done by supply company will not be
accepted by the public
profit margin kept to 8% - 10% per annum.
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Characteristics of a Tariff
5. Attractiveness
Should be attractive enough to encourage a large
number of consumers to use electrical energy
Efforts should be made to fix the tariff in such a way that
consumers can pay easily
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Types of Tariff
1.
Simple Tariff
2.
Flat Rate Tariff
3.
Block Rate Tariff
4.
Two Part Tariff
5.
Maximum Demand Tariff
6.
Three Part Tariff
7.
Power Factor tariff
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1. Simple Tariff
Fixed rate per unit of energy
Price charged per unit is constant and do not vary with
change in units consumed
Consumption is recorded by meter at consumer premises
Simple and easy for consumers
Disadvantage – no discrimination, cost per
unit delivered is high
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2. Flat Rate tariff
Different types of consumers are charged at different uniform per unit
rates
Consumers are grouped into different classes and each class
is charged differently (Light, Power, etc.)
Classes are made taking into account their diversity factor
and load factor
More fair to different types of consumers and simple to
calculate
Disadvantage of Flat Rate Tariff
Separate meters are required for different loads (expensive)
Particular class of consumers is charged with the same rate
irrespective of the magnitude or energy consumed
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3. Block Rate Tariff
When a given block of energy is charged at a specific rate and
the succeeding blocks of energy are charged at progressively
reduced rates
Energy consumption is divided into block and
the price per unit is fixed in each block
First block price per unit is high and other
blocks lower
Consumers get incentives to consume more,
increases load factor and reduces generation
cost
Used of majority of residential and small
commercial consumers
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4. Two- part Tariff
When the rate of electrical energy is charged on the basis of maximum demand of
the consumer and the units it consumes.
Total charge to be made from consumers is split into 2
components
fixed charge (MD)
Running charge (units consumed)
ChargeT = Rs[b(kW) + c(kWh)]
Mostly for industrial consumers
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Two – part Tariff continued…
Advantages of Two-part Tariff
Easily understood by consumers
Recovers the charges which depends upon the
maximum demand of the consumer but are
independent of the units consumed
Disadvantage
Consumer has to pay the fixed charges irrespective of
usage
Always error in assessing MD of consumers
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5. Maximum Demand Tariff
Similar to Two-part Tariff except that the MD is measured by the MD meter
in the premises of the consumer (removes the objective of the TPT)
Mostly applies to big consumers and not suitable for small
consumers like residential loads (separate MD meter is required)
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6. Three-Part Tariff
When the total charge to be made by the consumer is split into three parts
(Fixed, semi-fixed charge and running charge)
Charge T = Rs [a + b(kW) + c(kWh)]
Mostly applicable to bigger consumers only.
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7. Power factor Tariff
The Tariff in which the factor of the consumer’s power factor is taken into account
Power factor increases the rating of the station equipment and
line losses. Therefore consumer with the low pf has to be
penalized.
Eg. kVA MD Tariff, Sliding Scale, kWh/kVAR Tariff
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i. PFT – kVA MD Tariff
Modified from Two–part Tariff
The fixed charges are made on the basis of MD in kVA
and not in kW (consumers with low pf has to pay towards
the fixed charges)
Encourages consumers to operate their load at improved
pf.
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ii. PFT – Siding Scale Tariff
Known as Average Power Factor tariff
If pf of a consumer falls below the reference pf (say 0.8
lag), suitable additional charges are made.
If the consumer is above the reference pf value, consumer
is awarded with the discount.
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iii. PFT – kWh/kVAR Tariff
Both active power (kWh) and reactive power (kVAR)
supplied are charged separately
Consumer with low pf will draw more reactive power and
hence shall have to pay more charges.
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Discussions
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