Meralco customers to enjoy lower rates this mo

Manila Electric Co. (Meralco) customers will be paying lower electricity bills this month as the country’s biggest power distributor will pass on to its customers the results of trimming both its generation and systems loss charges.

Meralco customers, for this month at least, will get a reprieve from surging electricity bills with households consuming an average of 200 kilowatthour (kwh) per month getting a reduction of as much P45.84 in this month’s bill as a result of the government’s "economic dispatch" scheme.

Customers with consumption of 200 kwh per month account for 31.6 percent of total usage, the biggest block among the power firm’s residential consumers.

Economic dispatch refers to the dispatch of power plants to achieve the economic operation and maintenance of quality, stable, reliable and secure power system, resulting in the least cost to the consumers.

As a result of the economic dispatch, Meralco generated a discount of 22.92 centavos per kwh.

Under the scheme, Meralco’s independent power producers (IPPs) will be dispatched to the maximum in the next two weeks as a trial run while the National Power Corp.’s (Napocor) power plants are undergoing maintenance.

The trial run will determine the appropriate dispatch priority of the generation plants.

Of the 22.92-centavo reduction, 19.43 centavos was attributed to the generation charge resulting from the higher dispatch of Meralco’s IPPs in August.

Meralco also said its lower rates this month is a result of the lower generation and systems loss charges. This will translate into decreases ranging from 0.33 centavos to 2.57 centavos for residential and other secondary customers.

Aside from this, Meralco’s discounts to its residential customers will go up by 36 centavos per kwh from P0.1997 to P0.2033.

Moreover, the bills of lifeline residential customers or those consuming 50 kwh and below will go down by P5.82 or 11.64 centavos per kwh. Those consuming 70 kwh will get a P10.52 reduction in their electricity bills or 15.03 centavos per kwh, while those consuming 100 kwh will get a reduction of P18.41 or 18.41 centavos per kwh.

On the other hand, customers with consumptions exceeding the lifeline level will have a reduction of 23 centavos per kwh. Those belonging to the other rate classes will experience the 19.43-centavo decrease in the generation charge and decrease in the system loss charge depending on voltage plus the franchise tax impact.

"The 19.43-centavo reduction in the generation charge was due to the increased generation of the independent power producers and the National Power Corp. in August as compared to that of July," said Meralco vice president for corporate communication Elpi Cuna.

The generation charge is the component of the Meralco bill that reflects changes in the generation costs of its suppliers, namely the IPPs and Napocor.

Meralco’s IPPs include Quezon Power, First Gas Santa Rita and San Lorenzo power plants. The power distributor buys about 40 percent to 50 percent of its power requirements from Napocor while the rest is supplied by its own IPPs.

Among the factors contributing to the changes in generation costs are the level of dispatch of the IPPs, the peso-dollar exchange rate, and fuel prices. The reduction also shows the full impact of the wet-season rates of Napocor.