Tariff Policy (Revised)

Tariff Policy

Tariff Policy under the Electricity Act 2003

Law passed

Last amendment

In January 2006, the Ministry of Power announced the Tariff Policy, in continuation of the National Electricity Policy of 2005. The Tariff Policy included certain provisions regarding renewable energy and cogeneration. Under the Electricity Act 2003 and the National Tariff Policy 2006, the central and the state electricity regulatory commissions must purchase a certain percentage of grid-based power from renewable sources. Solar power is to comprise 0.25% of power purchases by states by 2013, and 3% by 2022. The appropriate electricity commission is to fix a minimum percentage for purchase of energy from renewable and cogeneration sources, taking into account resource availability and impact on tariffs. Percentages for energy purchase were made applicable for tariffs to be determined by the State Electricity Regulatory Commission (SERC) by 1 April 2006. Procurement by distribution companies is to be done at preferential tariffs, determined by the appropriate commission, to encourage non-conventional energy technologies to eventually compete with conventional ones. Such procurement is to be done through a competitive bidding process. In January 2011, the Tariff Policy was amended to align with the National Solar Mission strategy. State electricity regulators to purchase a fixed percentage of solar power. This will be supported by a Renewable Energy Certificate (REC) mechanism.

Tariff Policy 2006

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An aim to achieve a quantifiable outcome within a given time-frame, set by an institution such as a national government.

Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

Risk is the potential for adverse consequences resulting from the dynamic interplay between (climate-related) hazards, exposure, and vulnerability of affected human or ecological systems.

Groups  of people who are adversely affected by climate change or the response to it

A set of principles, processes, and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

Any compulsory, unrequited payment to the government levied on corporations or individuals. This can be for environmental reasons, such as introducing a Carbon tax to set a price that emitters must pay for the greenhouse gases they emit.

A subsidy is a direct or indirect payment to individuals or businesses, typically provided as a government cash payment or a specific tax reduction.

Tradable permits are market-based tools that grant permission for specific activities, frequently used to regulate emissions. These permits can be issued within a trading system to manage environmental impacts.

Actions or measures to adapt terrestrial systems to climate change.

This sector includes firms and individuals offering specialised expertise in fields such as law, accounting, consulting, science and engineering.

Activities of businesses and institutions that provide financial services and products to individuals and organisations.

Actions to adapt human health, healthcare systems and well-being to climate change.

The activities of industries involved in the production, distribution, and sale of energy, including electricity, gas, and renewables.

This sector creates and distributes information and entertainment through television, radio, print, and digital platforms.

Actions or measures to adapt freshwater systems to climate change.

This sector involves managing waste treatment, sanitation, pollution control and environmental cleanup.

People who are less able to respond to the effects of climate change due to having limited financial or physical assets

Any substance with chemical properties that can cause physical harm to people or damage the environment, including ammonia, carbon monoxide, phosphine, chlorine, arsenic, cadmium, mercury, pesticides, dioxins, microplastics, benzene, asbestos, aflatoxins, fluoride, methanol, and toxins from marine sources.

Climate change can have a range of impacts on technological system. Extreme weather events can cause infrastructure failures like power outages or damage to roads and bridges, as well as the impacts from waste following natural disasters. Human activities also cause technological impacts, such as the risks posed by oil spillage and leaks.

Coal is a combustible sedimentary rock formed from carbonised plant matter, rich in carbon and hydrocarbons, and occurring in several main types including hard coal and brown coal.

Either money or something of monetary value is transferred between two or more organisations, people or countries.

Electrical energy generated from mechanical devices driven by flowing fresh water.

Activities that involve planning, designing and building infrastructure, residential, and commercial structures.

Kinetic energy of airflow transformed into useful energy, mostly electrical energy.

Production of electricity and heat from solar irradiation.

This sector involves the distribution, treatment, and conservation of water resources.

Conditions that enhance the feasibility of adaptation options. Enabling conditions include finance, technological innovation, strengthening policy instruments, institutional capacity, multi-level governance and changes in human behaviour and lifestyles.

Compulsory, required payments to the government that are levied more-or-less in proportion to the services provided. Fees and charges range from entrance fees to national parks, charges on land-based sewage discharge.

A company that is owned wholly or partially by the state, typically operating in key sectors.

Climate change impacts our society by disrupting the natural, economic and social systems we depend on. Physical hazards and underlying vulnerabilities can lead to increased resource competition for food and water, which can heighten the risk of conflict.

A loan is a policy instrument where funds are provided to a borrower with the expectation of repaying the principal plus interest.

Actions or measures to adapt freshwater, coastal and marine systems to climate change.

Social inclusion is the process of improving the terms on which individuals and groups take part in society—improving the ability, opportunity, and dignity of those disadvantaged on the basis of their identity.

Tariff Policy (Revised)

Target

Policy instrument

Risk

Impacted group

Just transition

Renewable energy

Fossil fuel

Greenhouse gas

Economic sector

Adaptation/resilience

Finance