Progressive Pricing

Progressive pricing is an energy pricing system where the cost per unit increases as consumption rises. It encourages energy efficiency by rewarding lower usage with cheaper rates and charging higher prices for higher consumption.

How It Works
Under progressive pricing, energy usage is divided into consumption bands or tiers. The first units of energy are priced at a lower rate, with the cost increasing for each higher tier. This structure aims to promote responsible energy use and reduce overall demand.

Benefits & Consumer Impact
Progressive pricing encourages lower energy use, helping reduce strain on the grid and lower emissions. It supports fairness by ensuring those who consume more pay higher rates, while protecting low-use households from high costs.

Future Outlook
As demand management becomes more important, progressive pricing is likely to expand alongside smart meters and digital billing systems. It can play a key role in reducing peak demand and supporting energy transition policies.