What is the difference between the current Flat Tariff and Time of Use tariffs?
Currently, SP AusNet charges the majority of its customers based on a flat tariff for the use of its network. This means that the same price is applied regardless of when electricity is used. Under this flat rate tariff structure, people who use electricity during the off-peak periods (85% of the year) are subsidising people who use electricity at times of peak (15% of the year), as it is only usage during peak periods that drives SP AusNet’s future costs (through having to provide increased network capacity to cater for ‘peak’ periods). Network tariffs that more closely mirror the costs associated with providing network capacity reduce this cross subsidy.
