What are primary and secondary units?

kittiej

Hello

Could anyone tell me what primary and secondary units actually means?

Is it to do with time of day or something?

Sorry I'm clueless lol

Premier_2

Traditionally energy suppliers charged a daily standing charge.

However, no standing charge options became available and 2 tier unit charging was introduced.

The primary tier sought to recover the former standing charge, whilst the secondary tier allowed for the former lower rate unit charges that applied when a daily standing charge applied.

e.g. say a company offered units at 10p each plus an annual standing charge of £100

With no standing charge, the company would recover the £100 by loading the unit price, say to 20p per unit. However, after the consumer used 1000 units, then they would be paying more per year, so primary unit charge of 20p would apply for initial 1000 units p.a. and then a secondary unit charge of 10p would apply for all extra.

HTH.