Choosing the Right Electricity Pricing Category for Corporate Procurement

Choosing a Category: The Cost of Getting It Wrong

Selecting the right price category for electricity procurement is a critical decision for the chief power engineer at any industrial enterprise. A mistake can result in overpayment of tens of millions of rubles per year. What's more, once chosen, the category cannot be changed during the regulatory period. That's why it's essential to consider the specific characteristics of each enterprise and its electricity consumption profile before making a decision. This article examines how electricity costs can vary depending on the price category selected.

One of the main questions facing chief power engineers at industrial enterprises is: which price category should we choose? According to the rules governing retail electricity markets, consumers must independently determine the category under which they will purchase electricity.

A price category is a type of electricity tariff that consumers select based on the specifics of their energy consumption, primarily their electrical load profile. The calculation procedure for price categories is established by regulatory documents. However, conducting the necessary calculations independently for an industrial enterprise can be quite complex.

The choice between the third and fourth price categories can only be made once a year—within the calendar month following publication of the decision establishing unified pooled tariffs for electricity transmission in a particular region. After this deadline, the category cannot be changed until the end of the regulatory period. If the choice proves unfavorable, overpayment can amount to tens of millions of rubles per year. Moreover, such overpayment would be entirely legal.

How Price Categories Work

There are six price categories in total. The first and second can be used by small enterprises with maximum capacity of electrical equipment up to 670 kVA. For industrial enterprises, the third through sixth categories are primarily used. The third and fourth are most common, since the fifth and sixth are less advantageous in most cases.