Meralco: Power rate up by P0.66/kWh this month

By Lenie Lectura – March 9, 2017

from Business Mirror

A residential household consuming 200 kilowatts per hour (kWh) a month will shell out P132 more to pay for its power bills this month.

This, after the Manila Electric Co. (Meralco) said on Thursday that rates will increase by P0.66 per kWh, thereby bringing the overall rate to P9.67 per kWh from last month’s rate of P9 per kWh.

The rate hike was mainly brought about by higher generation charge, which increased by P0.58 per kWh to P4.90 per kWh. This amount already includes the partial amount that Meralco needs to recover for sourcing its power requirements from other power suppliers that use liquid fuel during the 20-day shutdown of the Malampaya natural-gas facility.

The shutdown affected the natural-gas supply to the Ilijan, Santa Rita and San Lorenzo plants, which supply an aggregate capacity of 2,565 MW to Meralco’s franchise area. With the shutdown, these plants had to switch from natural gas to more expensive liquid fuel so that they can continue supplying power to the grid.

The Malampaya shutdown also coincided with the scheduled maintenance of other power plants, such as the SEM-Calaca Power Corp. Unit 1, Quezon Power (Philippines) Ltd., and one block of the Ilijan power plant, which collectively contributes some 1,185 MW of Meralco’s power requirements.

Aside from the generation charge increase, taxes and other charges went up by a combined amount of around P0.09 per kWh.

Meanwhile, there was a slight decrease in the transmission charge of residential customers of P0.01 per kWh. Meralco’s distribution, supply and metering charges, meanwhile, have remained unchanged for 20 months, after these registered reductions in July 2015.

Meralco reiterated that 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 National Grid Corp. of the Philippines (NGCP).

The utility firm also said that it appreciates the timely action of the Energy Regulatory Commission (ERC) on its petition to stagger the incremental liquid-fuel cost over three months, or from March to May 2017. This staggered scheme will help mitigate the effect of the Malampaya shutdown on consumers’ bills.

In Meralco’s application filed on January 31, the incremental liquid fuel cost was estimated at P2.417 billion, using certain assumptions, equivalent to around P0.92 per kWh.  Based on actual suppliers’ billings provided to the ERC on March 3, the incremental cost was lower at P1.752 billion, or approximately P0.66 per kWh, the collection of which will be staggered over three months.

Meralco said the power situation during the Malampaya shutdown was normal throughout, and this led to spot prices being lower than what they were forecasted end of last year.