Tariffs

INTRODUCTION
By tariffs is meant the schedule of rates framed by the supplier for the supply of electrical energy to various types of consumers.Thus,different methods of charging a consumer or rates of payments by the consumer,for consuming electrical energy are known as tariffs.The following factors are taken into account to decide the tariff:
Type of load(domestic,commercial,or industrial)
Maximum demand
Time at which load is required
power factor of the load
Amount of energy used.
The manner in which consumers pay for electrical energy varies according to their requirements.Industrial consumers use more energy for longer times than domestic consumers. Tatiff should be such as to cover total cost of producing and supplying electrical energy plus a reasonable profit.
The cost of electrical energy supplied by a generating station depends on the installed capacity of the plant and kWh generated.Increase in maximum demand increases the installed capacity of the generating station.
The time at which maximum demand occurs is also important in plant economics.If the maximum demand of the consumer coincides with the maximum demand on the system,additional plant capacity is required .However,if the maximum demand of the consumer occurs during off-peak hours,the load factor is improved and no extra plant capacity is needed.Thus,the overall cost per kWh generated is reduced.
Power factor is also important from the point of view of plant economics.At a low power factor,the load current is large.Consequently,the current to be supplied form the generating station is also large.This large current is responsible for greater (I*I)/R losses in the system and larger voltage drops.Thus,the regulation becomes poor.In order to supply the consumer's voltage within permissible limits,power factor correction equipment is to be installed.Therefore,the cost of generation increases.
The cost of electrical energy is reduced by using a large amount of energy for longer periods.