Meralco rates to go down starting next month

MANILA, Philippines - The Energy Regulatory Commission (ERC) has approved a new average price for Meralco, which will mean lower rates for consumers starting July.

As an example, a residential customer consuming 200 kilowatthours will have a combined 15-centavo per kwh reduction in its Meralco charges to P2.20 per kwh from P2.35 per kwh or a reduction of six percent of what he currently pays.

With the ERC’s approval, the different customer classes will experience around five to six percent reduction in their distribution, supply and metering charges under Meralco.

This after the ERC approved on May 5 Meralco’s application for a maximum average price (MAP) of P1.5562 per kwh for regulatory year 2015.

The P1.5662 per kwh MAP for regulatory year 2015 is lower than Meralco’s MAP for 2014 of P1.6474 per kwh, said the power distributor in its petition filed in March.

“To allow its customers to immediately enjoy the lower distribution rates, it is necessary that a provisional authority be immediately issued authorizing it to implement the proposed rates pending hearing on the merit of the instant application,” Meralco said.

The MAP rate of P1.5562 per kwh is broken down as follows: Distribution charge, P1.1398 per kwh, P0.2537 per kwh and metering charge of P0.1627 per kwh.

The MAP is allowed under the ERC’s rules for Performance-Based Regulation (PBR), under which the ERC reviews and verifies the rates of all private distribution utilities each year, considering such factors as their performance against technical and customer service standards.

Under the PBR method, annual revenue requirement, resulting indicative prices and performance incentives have been approved before the start of the regulatory period from July 2011 to June 2015.

Meralco said it has been able to improve its service to the customers beyond the standards set. Because of this, customers now experience lesser interruptions, lower system losses and faster customer response time, it said earlier.