Meralco rates up in October

MANILA, PHILIPPINES – From September’s P0.58 ($0.013*) reduction, electricity bills for October will go up by P0.10 ($0.002) the Manila Electric Company (Meralco) said Wednesday, October 8.

For a typical household consuming 200 kilowatt (kWh), they will see an increase of about P20 ($0.45) in their October bill.

The increase was due to the P0.16 ($0.004) per kWh or from P5.19 ($0.12) per kWh to P5.35 ($per kWh upward adjustment in generation charge, the biggest component of a Meralco bill.

The generation charge for September that will be reflected in the October bill went up because of the 5-day Malampaya restriction, from September 8 to 11 and September 21 to 23, which forced the Sta. Rita and San Lorenzo power plants to use more expensive liquid fuel in lieu of natural gas, thus resulting in higher generation costs from these plants. Also, the Malampaya restriction reduced dispatch of the Ilijan power plant during the September supply month. 

The weakening of the peso against the dollar from P43.59 ($0.97) to P44.88 ($1.00) in September also contributed further to the increase in generation charge.

The use of alternative fuel by the natural gas plants accounted for P0.13 ($0.003) per kWh of the increase in the generation charge, while the higher foreign exchange rate added another P0.08 ($0.0018) per kWh. Without these upward adjustments, the generation charge would go down to P0.05 ($0.001) per kWh.

Meralco sources its power requirements from Power Supply Agreements (PSAs), Independent Power Producers (IPPs), and the Wholesale Electricity Spot Market (WESM).

The utility firm said it sourced 53% from PSAs, 46% from IPPs, and 1% from WESM of its total power requirements for the September supply month, respectively.

IPPs registered a P0.44 ($0.010) per kWh average increase. Meanwhile, plants under the PSAs, as a whole, went down by P0.01 ($0.002) per kWh.  The spot market likewise registered a reduction of P7.45 per kWh ($0.17).

Meralco said the presence of the secondary WESM price cap helped moderate WESM charges and protected customers in spite of the successive restrictions of Malampaya and the outage of some power plants.

Contributing also to the overall upward adjustment in the bills to households is the P0.007 ($0.0002) per kWh increase in taxes.  Transmission charge, meanwhile, registered a P0.054 ($0.001) decrease per kWh. There was also a cumulative decrease of P0.008 ($0.0002) per kWh in subsidies and the system loss charge.

Meralco reiterated that it does not earn from the pass-through generation and transmission charges. Of the total bill, Meralco said only the distribution, supply, and metering charges accrue to the company. – Rappler.com

($1 = P44.77)