This document discusses different aspects of tariffs for electricity supply including objectives, types of tariffs, and key terms. It describes five main types of tariffs - simple, flat rate, block rate, two part, and maximum demand tariffs. It also covers related concepts like connected load, maximum demand, demand factor, diversity factor, load factor, reserves, load curves, and load duration curves.

1. Gujarat Power Engineering
& Research Institute
By-
-Ishani Bhatt(03)
-Vibha Patel(44)
-Karan Thawani(58)
-Madhav Rami(50)
Contents:-
-Tariff
-Economic Aspects
-Reserves
-Load and Load duration curves

2. oThe electrical energy produced at the generating
station is delivered to a large number of consumers.
o The rate at which energy is sold to the consumers is
called “TARIFF.”
oPricing the electricity generated is a truly complex
issue. Because a lot of costs are involved in producing a
unit of electricity from the coal in generation stations
to transmission lines losses to distribution system
losses and metering errors.
General form of tariffs:
akWh + bkW+ c

3. OBJECTIVES OF TARIFF
(1) Recovery of cost of electrical energy generated at
the generating system.
(2) Recovery of cost on the capital investment in
transmission and distribution system.
(3) Recovery of cost of operation, supplies and
maintenance of equipment.
(4) Recovery of cost of metering equipment, billing and
miscellaneous services .
(5) A marginal return (Profit) on the capital
investment .

4. TYPES OF TARIFF
Types
• SimpleTariff
• Flat RateTariff
Types
• Block RateTariff
• Two PartTariff
Types
• Maximum DemandTariff
• Power FactorTariff

5. (1) Simple Tariff: The tariff in which the rate per
unit of energy is fixed, is called simple tariff.
o It is in simplest form and easily understood by
the consumers.
o Consumer is to pay as per his consumption.
ADVANTAGES
General form : akWh

6. (2) FLAT RATE TARIFF: The tariff in which
different types of consumers are charged at
different per unit rates is called flat rate tariff.
ADVANTAGES
oIt is more fair to different types of
consumers.
oIt is quite simple in calculations.
General form : akWh

7. (3) BLOCK RATE TARIFF: Different blocks of energy
consumption are charged at different rates.
o For example, for the first 50 units the charge will be
Rs. 1.85 per unit and for the next 50 units the charge
is Rs.2.90 per unit.

8. (4) TWO PART TARIFF: Apart from the energy
consumed, there is charge for the maximum demand
also.
Total charges= Rs. (a X kW + b X kWh )
where, Rs. a= charges per kW of maximum demand
Rs. b= charges per kWh of energy consumed

9. (5)MAXIMUM DEMAND TARIFF: The tariff in
which electrical energy is charged on the basis of
maximum demand of the consumer.
(6) POWER FACTOR TARIFF: Power factor tariffs
are devised to differentiate between the good power
factor users and poor power factor users.
(a) KVA MAXIMUM DEMAND TARIFF: Instead of
charging the maximum real power demand, maximum
kVA demand is charged in addition to the charge
corresponding to energy.

10. (b)KWH AND KVARH TARIFF: Both kWh and kVAh
(the reactive power consumption are charged
separately.
(c) SLIDING SCALE TARIFF:There is some extra
charge if the power factor is below the set value
(0.8). If consumers improve the power factor an
incentive will be given to those consumers.

11. CONNECTED LOAD: Sum of the continuous rating of
the entire load consuming apparatus connected to the
system.
MAXIMUM DEMAND : The maximum demand of an
installation or system is the greatest of all the
demands that have occurred during a given period .
DEMAND FACTOR : This is the ratio of the peak
demand to the connected load.
oThis can be less than or equal to one.
Demand
Factor
Load
Maximum
Demand
Connected


12. DIVERSITY FACTOR: It is the ratio of sum of
individual maximum demand to the maximum demand of
the whole power system.
o It is always greater than one
LOAD FACTOR: Load factor determines the capability
of load utilization i.e. how long it is utilizing the power.
oThe load factor for a load is high if it switched on for
most of the time and is less when it is off for most of
the time.
Of Individual Demand
Factor=
Demand Of Entire Group
Sum Maximum
Diversity
Maximum

13. oThe definition goes like this : it is the ratio of
average load to the maximum load.
oAlthough this is not the exact definition. The exact
definition is the ratio of energy consumed to maximum
energy it can consume.
oA consumer is always defined by his load factor.
oWhenever a power plant is constructed it is designed
to serve the maximum demand of the customers
Load
Load Factor=
Load
Average
Maximum

14. PLANT CAPACITY FACTOR: It is defined as the
ratio of actual energy produced in kilowatt hours
(kWh) to the maximum possible energy that could have
been produced during the same period.
where, E = Energy produced (kWh) in a given period,
C = Capacity of the plant in kW, and
t = Total number of hours in the given period.
Plant Capacity Factor=
E
C t

15. PLANT USE FACTOR: It is defined as the ratio of
energy produced in a given time to the maximum
possible energy that could have been produced
during the actual number of hours the plant was in
operation.
where, E = Energy produced (kWh) in a given period,
C = Capacity of the plant in kW, and
t1= Actual number of hours the plant has been operation.
Plant Use Factor=
1
E
C t

16. RESERVES
SPINNING RESERVE: It is the generating capacity
which is connected to a bus (common connection) and is
ready to take the load.
COLD RESERVE: It is that reserve generating
capacity which is available for service but not in
operation.
HOT RESERVE: It is that reserve generating capacity
which is in operation but not in service.

17. FIRM POWER: It is the power intended to be always
available (even under emergency condition).
RESERVE MARGIN: It is the difference between
the rated capacity and the actual loading on the
generator.

18. oA load curve (or load graph) is a graphic record
showing the power demands for every instant during a
certain time interval.
oSuch a record may cover 1 hour, in which case it
would be an hourly load graph; 24 hours, in which case
it would be a daily load graph; a month in which case it
would be a monthly load graph; or a year (7860 hours),
in which case it would be a yearly load graph.
LOAD CURVES

19. Time(Hours)
Load(kW)
Base Load
Average Load
Peak Load

20. -The following points are worth noting :
(i) The area under the load curve represents the
energy generated in the period considered.
(ii) The area under the curve divided by the total
number of hours gives the average load on the power
station.
(iii) The peak load indicated by the load curve/graph
represents the maximum demand of the power station.

21. LOAD DURATION CURVES:
oAll the loads are rearranged in descending order.
Time(Hours)
Load(kW)
Base Load
Peak Load

22. The following points are worth noting :
oThe area under the load duration curve represents
total energy delivered by the generating station.
oProper selection of base load power plants and peak
load power plants becomes easier.