Meralco cuts rates by 43¢

Manila Electric Co. (Meralco) customers will enjoy a power rate cut of 43 centavos per kilowatthour (kWh) in August due mainly to an improvement in system loss figures.

Meralco said that aside from a drop of 5.08 per kWh in its system loss charge, its generation charge was also brought down by 37.86 centavos per kWh.

“ERC’s lifting of the suspension on the adjustment mechanisms enables us now to readily reflect the lower cost of supply to our customers,” Meralco vice president for corporate communications Elpi Cuna said. 

From the P5.6764/kwh level reflected in the July 2007 bills of customers, the generation charge for August 2007 is P5.2978/kwh. 

The system loss for residential customers, on the other hand, went down by 5.08 centavos to P0.8479/kwh.

Cuna said that commercial and industrial customers will likewise experience a reduction in their electricity bills.

The reduction in generation and system loss charges was brought about by a number of factors affecting Meralco’s cost of supply in July 2007. 

The average rate of National Power Corp. (Napocor), which supplied 38 percent of Meralco’s requirements, went down by 45 centavos to P5.19 per kwh. 

The cost of power supplied by the IPPs, accounting for 47 percent of total energy purchased, was also lower by 31 centavos at P4.03/kwh following the completion of Quezon Power’s scheduled maintenance and the continued very high dispatch of San Lorenzo.

These reductions served to temper the impact of the continuing rise in the cost of power sourced from the WESM, which at P9.5469/kwh surpassed the previous month’s P7.7901/kwh by P1.76 per kwh.

The impact of the high spot market prices on Meralco’s overall generation cost was tempered by Meralco’s reduced sourcing from the WESM, which, for the current supply month, only accounted for 15 percent of total energy purchases, a significant drop from the previous month’s 27 percent. 

“It was timely on our part to heed the call of former Secretary Lotilla to increase our offtake from Napocor under the TSC,” Cuna added. 

Napocor and Meralco signed an addendum to the TSC last July 19 increasing Meralco’s offtake from state-run power generation firm under the TSC by 1020 GWH per annum.

As a result of the reductions in the two pass-through charges, residential customers consuming 100 kWh per month will experience an almost P35 reduction in their monthly bill. Those consuming 200 kWh will see their bills go down by P91.