Meralco raises power rates by P2 this month

MANILA, Philippines — Electricity rates of power distributor Manila Electric Co. (Meralco) will increase by P2.1496 per kilowatt-hour this month, bringing the overall rate to P11.6012 per kWh from June’s P9.4516 per kWh.

The adjustment, which is due to higher generation charges, is equivalent to an increase of around P430 in the electricity bills of typical households consuming 200 kWh a month.

“We have an adjustment of P2.15 per kWh, primarily because of the normalization of rates for the current month of July,” Meralco vice president and head of corporate communications Joe Zaldarriaga said at a press conference yesterday.

From an over P1.83 per kWh reduction in June, the generation charge spiked by over P2 per kWh this month as power costs normalized following an Energy Regulatory Commission (ERC) order to stagger the collection of charges.

The ERC had allowed distribution utilities to pay their purchases from the wholesale electricity spot market (WESM) on a four-month installment basis to lessen the impact of high charges on consumers.

As a result, Meralco lowered its electricity rates by P1.9623 per kWh last month.

For the July billing, however, WESM charges went up by P6.6370 per kWh as a result of normalizing charges and the recovery of a portion of deferred WESM costs from the May supply period.

The increase was partly offset by the drop in spot market prices amid lower consumer demand in the Luzon grid, given the onset of the rainy season.

Meralco said charges from independent power producers (IPPs) edged up by P0.4392 per kWh, while those from power supply agreements (PSAs) climbed by P0.3530 per kWh.

WESM, IPPs and PSAs accounted, respectively, for 34 percent, 28 percent and 38 percent of Meralco’s total energy requirement for the period.

Transmission costs, meanwhile, dipped by P0.155 per kWh due to the absence of reserve market settlement charges that affected the ancillary service fees last month.

“We again appeal for the understanding of our customers over the delayed bills as we sought guidance from the ERC on the implementation of this month’s rate adjustment. Rest assured that Meralco will adjust the due dates to give our customers enough time to settle their bills,” Zaldarriaga added.

Meralco is the largest power distribution company in the country, providing electric service to around 7.8 million customers within its franchise area coverage, which includes Metro Manila, Rizal, Cavite, Bulacan and select areas in Pampanga, Batangas, Laguna and Quezon provinces.