power and water

Extreme heat spurs Meralco sales, warns tight supply amid El Niño

Ralf Rivas

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Extreme heat spurs Meralco sales, warns tight supply amid El Niño
The Manila Electric Company posts higher sales in the first quarter, as commercial buildings and households increase air conditioning usage

MANILA, Philippines – The Manila Electric Company (Meralco) posted higher energy sales volumes in the first quarter of 2024, as air conditioners worked double time to counter excessive heat brought about by El Niño.

The company’s consolidated distribution utility energy sales volumes rose to 12,307 gigawatt hours (GWh) from 11,287 GWh, as volumes of Meralco and Clark Electric Distribution Corporation increased by 9% and 7%, respectively.

Meralco noted that temperatures rose by an average of 0.5 degrees, or from 26.71 degrees Celsius to 27.21 degrees Celsius.

“An approximate 2.5 GWh of consumption per day is noted for every degree rise in temperature,” Meralco said.

Commercial buildings comprised the biggest share of consumption at 38%, followed by residential and industrial at 34% and 28%, respectively.

Meralco’s commercial sales volumes grew by 11% to 4,678 GWh, which exceeds the pre-pandemic 2020 figure.

“Growth was headlined by the real estate sector driven by demand for office spaces in central business districts, followed by the retail trade sector as mall operators expanded and repurposed spaces that attracted more customer visits,” Meralco said.

The Pangilinan-led power company also noted that hotels, schools, and restaurants had “significant consumption upswing” due to an increase in in-person events that used cooling equipment “to ameliorate increasingly warmer ambient temperatures.”

Residential sales increased by 12% reaching 4,144 GWh during the first quarter, also due to the increased use of cooling appliances at home. (READ: Filipinos urged to reduce aircon use as red alert raised on power grids)

Through electricity bills, Meralco told its customers that consumption increases by up to 40% during summer.

Meralco has a total of 7.9 million customers.

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‘Challenging power supply situation’

Meralco executive vice president and chief operating officer Ronnie Aperocho said the higher sales figures in the first quarter reflects the country’s growing demand for power across all segments. This also reflects the country’s “improving economic prospects.”

Aperocho also noted that Meralco already reached record peak demand in its franchise area, which has exceeded 9,000 megawatts.

“With Red and Yellow Alerts hoisted over the Luzon grid several times this April, we anticipate a challenging power supply situation throughout this dry season, coincidental with the El Niño phenomenon,” Aperocho said. 

Amid growing demand for power, Meralco chairman and chief executive officer Manuel Pangilinan is looking at nuclear energy.

“This year, along with our partner and in close coordination with the government, we hope to proceed with the full feasibility study on the possible adoption of nuclear energy. Similarly, we will endeavor to implement more sustainable initiatives to cater to more underserved communities in the country,” Pangilinan said.

Pangilinan said Meralco is expecting its full-year 2024 net income to reach over P40 billion, a 7.8% increase from 2023’s P37.1 billion. – Rappler.com

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Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.