Time-of-Day (TOD) Tariff

Facts for Prelims

Time-of-Day (TOD) Tariff

News: It is in context of India’s new electricity pricing system.

What is TOD Tariff?
• Time-of-Day (ToD) tariff is an electricity pricing system that adjusts prices based on demand, with higher rates during peak hours and lower rates during off-peak hours.
• The goal is to encourage consumers to use electricity when demand is lower, helping to manage energy consumption and grid load.
• It will be introduced in India in 2024 for commercial and industrial users and in 2025 for other users. ToD tariffs are already used in many countries, including the US, UK, and Japan. Smart meters are needed to track electricity use every 15 minutes in this system.

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