The impact of time-of-use bulk supply electricity prices on a neighbouring cogenerating utility

The authors describe the process of converting Transkei Electricity Supply Corporation (TESCOR) from a conventional "maximum demand" tariff (Tariff A) to a radically new, all kilowatt-hour, time-of-use option (Tariff T2). The purchase of electricity on time-of-use tariffs has a significant impact on the way cogenerating utilities schedule their own generation, design their system control and data acquisition systems, and plan further generating capacity requirements. It is concluded that, for cogenerating utilities using hydro-generation, particularly when significant water storage is available, purchasing electricity from Eskom on time-of-use tariffs offers the prospective advantage of reduced electricity import costs, the opportunity to improve short-term cash flows, reduced operating and maintenance costs, and an overall reduction in system control complexity.