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When a given block of energy is charged at a specified rate and the succeeding block of energy are charged at progressively reduced rates, it is called:

When a given block of energy is charged at a specified rate and the succeeding block of energy are charged at progressively reduced rates, it is called: Correct Answer Block rate tariff

Block Rate Tariff: When a block of energy is charged at a specified rate and the succeeding blocks of energy are charged at progressively reduced rates, it is called as block rate tariff.

  • The energy consumption is divided into blocks and the price per unit is fixed in each block
  • The price per unit in the first block is the highest and it is progressively reduced for the succeeding blocks of energy
  • The consumer gets an incentive to consume more electrical energy
  • This increases the load factor and hence the cost of generation is reduced
  • It is being used for majority of residential and small commercial consumers

 

Disadvantages:

  • It lacks a measure of the consumer demand

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