Meralco lowers electric rates

By Lenie Lectura – October 9, 2018
from Business Mirror

POWER rates paid by customers of the Manila Electric Co. (Meralco) went down by P0.0966 per kilowatt-hour in October to P9.9766 per kWh mainly on account of lower generation charge.

The decrease will result in a downward adjustment of around P19 in the total bill of a typical household consuming 200 kWh. Since April this year, electricity rates registered a net decrease of 57 centavos per kWh.

“We are pleased to announce that, despite prices of other basic goods and commodities generally going up, Meralco customers can find some relief in the decrease of power rates these past two months, as this goes against the current trend that we see with other products,” Meralco Spokesman and Head of Public Information Office Joe Zaldarriaga said.

From P5.2719 per kWh last month, generation charge for October went down to P5.1908 per kWh, a decrease of P0.0811 per kWh.

The decrease in generation charge is mainly the result of P0.2790-per-kWh reduction in charges of power supply agreements. Despite the weakening of the peso against the US dollar and the scheduled maintenance outage of Sual Unit 1 that started on August 31, the cost of power from PSAs went down due to higher dispatch of Masinloc and Ilijan plants. The share of PSA purchases to Meralco’s total requirement this month was 36 percent.

The decrease in PSA charges offset the P0.0414-per-kWh increase in cost of power from independent power producers as a result of continued peso depreciation. About 96 percent of IPP costs are denominated in US dollars. The share of IPP purchases to Meralco’s total requirement this month was at 41 percent.

Cost of power from the Wholesale Electricity Spot Market slightly increased by P0.2981 per kWh due to lower availability of power plants in the Luzon grid. The share of WESM purchases to Meralco’s total requirement this month was 23 percent.

P0.0111 per kWh due to the increase in National Grid Corp. of the Philippines’s (NGCP) ancillary service charges. Meanwhile, taxes and other charges went down by P0.0266 per kWh this month.

Meralco’s distribution, supply and metering charges, meanwhile, have remained unchanged for 39 months, after these registered reductions in July 2015.

Meralco said it does not earn from the pass-through charges, such as the generation and transmission charges. Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the NGCP.  Taxes and other public policy charges like the feed-in-tariff allowance rate are remitted to the government.