Higher Meralco rates seen in April

MANILA, Philippines — Customers of Manila Electric Co. (Meralco) may see higher power rates this month due to a possible increase in generation and transmission costs amid extreme heat.

“We are still waiting for some billings, but indications point to a possible increase in the generation and transmission charges,” Meralco spokesman Joe Zaldarriaga said yesterday.

The tight supply situation, he said, pushed up prices in the Wholesale Electricity Spot Market (WESM), the centralized venue for buying and selling electricity as a commodity.

System-wide WESM rates in March surged to P5.34 per kilowatt-hour, the highest in the past seven months, nearly doubling February’s P2.73 per kWh.

Close to 1,000 megawatts of average capacity were lost in the system, while the average demand increased by over 1,000 MW, Zaldarriaga said, citing initial data.

“Higher ancillary service (AS) charges due to higher reserve market prices will likely drive transmission charges in the April billing,” he said.

Commonly referred to as reserves, AS provides backup power to maintain the reliability and stability of the national grid during supply-demand imbalances.

“We hope that the start of the implementation of the refund approved by the ERC (Energy Regulatory Commission) will help mitigate possible increases in bill components,” Zaldarriaga said.

Meralco is set to implement a P19.96-billion refund over a period of 36 months, equivalent to a reduction of P0.19 per kWh for residential customers.

The refund rate will be reflected as a separate line item in Meralco customers’ power bills.

Meralco, which serves at least eight million customers in Metro Manila and nearby provinces, hiked power rates by about P0.26 per kWh last month.