The aim of the paper is to realize the impact of relative humidity (R.H) on the fixed costs of domestic electricity tariff for low tension customers. In this paper, a comparison is made between the tariff structures, used currently in New Delhi from North India and Tamil Nadu from South and tariff structures after modifications due to the effect of relative humidity. Due to the diverse geographical conditions existing in the Indian subcontinent, a difference between electricity demand requirements and demand met is impending. It becomes imperative to realize the effect of relative humidity as the present condition of the country's T&D losses is around 23%. This paper helps any generation or distribution firm in realizing the potential of the effect of relative humidity on transformers and motivates them to improve their defense against relative humidity effects. This paper realizes the effect into the fixed costs that the company recovers from the customers. This paper also shows, how the compensation towards the losses due to relative humidity can be recovered without any sizeable effect on the interest of customers. © 2016 IEEE.