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Why are we experiencing high electricity bills post Lockdown?

By on July 10, 2020 with 12 Comments  

Expressing shock over high electricity bills is not uncommon. However, that is mostly the first reaction. The next thing that most people do is doubt the electricity distribution company. Making mistakes in electricity bill calculation is not uncommon, but rarely does it happen on a large scale. And unprecedented times are giving us unprecedented experiences. Post lockdown, we are receiving several complaints from people saying that their electricity bills are exorbitant. Even celebrities are complaining about the same on Twitter. Yes, indeed they are high, but let’s examine why we are in the current situation and what all you can analyze before putting a complaint with your electricity distribution company.

Why are we in this situation?

We have two components on our electricity bills: fixed charges and energy charges. Fixed charges do not vary month-to-month, but energy charges do vary based on our monthly consumption. We all have an energy meter in our house installed by our electricity distribution company. This energy meter records our electricity consumption every moment. Our electricity bills are generated when a person from our electricity distribution company comes and records the reading on this energy meter every month. Although there are SMART meters that can digitally transfer your readings to the energy distribution company, they are still rare in our country.

Now the Lockdown brought this process of meter reading to a grinding halt. And everything was thrown in disarray. Meter readings were not taken for months (March till Lockdown), and the bills were generated on average reading.

What is Average Reading?

The definition of average reading may vary from place to place. It can be average monthly consumption throughout the year (in the previous year), or it can be average of past few months, or it can be average of a specific month in the past few years. It is essential to ask your electricity distribution company on how they came up with the average. In Maharashtra (or specifically Mumbai where I live), the average used was average of the past 3 months. So, for the month of March, April and May, I was billed on average of December, January and February. It can be different if you are not in Maharashtra and before you start analyzing, please confirm with your distribution company on which months were used for calculation of average.

How does a month make a difference?

Your consumption of electricity varies throughout the year. Two of the most significant electricity consuming appliances in residence: Air Conditioners and Ceiling Fans are used a lot in summers and much less in winters. This results in higher electricity consumption in summers and lower in winters. Now in my case, the average was based on December, January and February, which are the lowest in terms of consumption. And my highest consumption is in April, May and June (months when I use ACs and Fan). What this resulted in was that I paid bills equivalent to December, January and February for March, April and May. This resulted in a big gap. All of which got added in June for which I got the bill (after the actual meter reading).

Bill Calculation

Did Lockdown have an impact?

It certainly did. In my house of 3 adults and 2 kids, 4 people usually used to be out of the house in a typical month of April and May. My wife and I would go to work, and my kids would go to school. All of this resulted in less electricity consumption at home for the 8-10 hours when we were out. But Lockdown got us all locked in the home with increasing consumption of ACs and Fans (which contribute a lot to electricity bills). What this resulted in increased units consumed for March, April, May and June in comparison to last year. For extra 8-10 hours, our electricity consumption increased by roughly 30% (however, it can vary depending on how much AC you use).

Consumption

Shouldn’t we get relief because of COVID?

Yes, we should, and many governments are trying to give people relief because of COVID. In fact, in Maharashtra, the government did announce 8% cuts on electricity bills for the next five years. But increased electricity consumption negated it all. In my case, my consumption increased by 30%, so the 8% discount did not help me bring down my electricity bills. Instead, they increased. So even though I should have got relief, but because I increased my electricity consumption, my bills increased.

But I am not complaining, because due to Lockdown, I rarely travel to the office and my consumption of petrol/fuel has come down significantly. So, if I spend somewhere, I save somewhere.

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Is there anything else that can impact my bills?

Usually, the electricity tariffs are slabbed, i.e., you pay less for lower consumption and high for higher consumption. So, for, e.g. in Maharashtra the cost of electricity is lowest for the first 100 units. It then increases if your consumption is between 101 and 300 units and highest if your electricity consumption increased beyond 500 units. So, with increased consumption, it is quite likely that your consumption may have gone beyond a limit and into a higher slab. Keep an eye on the slab that you lie in.

What can you do to analyze?

Here are a few steps that you can take to analyze your electricity bills and understand why they are high post lockdown:

  • Find out from your electricity distribution company as to what months did they take for calculating the average billing. If you are in Maharashtra, please note that the bills were generated based on consumption in December, January and February. Do look at this video shared by Adani Power (my distribution company): https://youtu.be/N6B-DglJtIE
  • Compare your total electricity bills of last year from the electricity bills for this year in the same period.
  • Analyze the amount of change in consumption that may have happened. If you are spending 8 hours more at home in a day, then you may be consuming about 30% (8 out of 24) more electricity than usual. It can be more than that as well. So, your bills should be about 30% higher for these months.
  • Ask for the calculation from your electricity distribution company. Make sure that all of your units consumed are distributed uniformly across months and is not exorbitantly high in a single month. Dumping all the units in a single month can push you into a higher slab.

What can you do if you have doubts on your electricity bills?

You have done the analysis as mentioned above, and you are still not okay with the calculation and want to complain? Well, the best way to do it is to first reach out to CGRF (or Custom Grievance Redressal Forum) at your electricity distribution company. By law, all electricity distribution companies have to have a CGRF, and they have to listen to your complaints. If they are not able to solve your problem, then you can reach out to the Ombudsman at your electricity regulatory commission. The state electricity regulatory commission is an independent (government) body. It does not have any financial interests with your distribution company. They should surely be able to give a fair judgement.

Conclusion

Lockdown has undoubtedly brought great pain to all of us. And electricity bills are adding on to that. But it is always good to do an analysis on our own before taking in all the extra negativity with others. We hope this post helps you do the same.

About the Author:
Abhishek Jain is an Alumnus of IIT Bombay with almost 10 years of experience in corporate before starting Bijli Bachao in 2012. His passion for solving problems moved him towards Energy Sector and he is keen to learn about customer behavior towards Energy and find ways to influence the same towards Sustainability. .

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