Meralco rates jump P0.89/kWh in April
Almost all of the components of the electricity bill are up such as the generation, transmission and system loss charges

People arrive at the office of Meralco, the country's largest power distributor, to make payments. AFP PHOTO/JAY DIRECTO

MANILA, Philippines – Customers of the Manila Electric Company (Meralco) will pay more for their electricity in April as almost all components of the bill registered increases.

Meralco rates went up by P0.89 per kilowatt-hour (kWh) this month. This translates to a net increase of P178.91 for households consuming 200 kWh a month, P268.36 for those using 300 kWh, P357.82 for 400 kWh, and P447.28 for 500 kWh.

The increase was mainly due to a P0.69 per kWh jump in the generation charge or cost of power sold by generation companies to P5.90 per kWh in April from P5.21 per kWh in March.

The generation charge increase was mainly driven by the P16.69 per kWh spike in the average Wholesale Electricity Spot Market (WESM) price to P21.59 per kWh during the March supply month from P4.90 per kWh the previous month. Meralco obtained only about 4% of its power requirements from WESM.

Meralco also attributed the increase in the generation charge to higher demand, coupled with tight supply condition brought about by the outage of several large power plants. Demand in March increased by 200 megawatt (MW), or roughly equivalent to the consumption of 10 large malls.

Among the power plants that went on scheduled maintenance shutdowns were the Sta. Rita Unit 40 of First Gas Power Corporation, Calaca-2 of SEM-Calaca Power Corporation, Masinloc-1 of Masinloc Power Partners Company Ltd., and the Ilijan-1 of South Premier Power Corporation.

The power facilities that experienced emergency shutdowns were Sta. Rita Unit 20, Calaca-1, Masinloc-2; and GN Power-2 of GN Power Ltd.

Meanwhile, the Sual-2 of San Miguel Energy and Malaya-1 of the Power Sector Assets and Liabilities Management Corporation registered limited capacity.

Meralco also noted a P0.20 per kWh increase in the average cost of power sourced from its Power Supply Agreements (PSAs). But this was offset by a P0.19 per kWh reduction in the rates of the Independent Power Producers (IPPs). PSAs and IPPs accounted for 51% and 45%, respectively, of Meralco’s requirements.

Besides the generation charge, the transmission and system loss charges, as well as taxes went up. Below are the increases:

Transmission charge – up P0.03 per kWh
System loss – P0.06 per kWh
Taxes – P0.11 per kWh

The distribution charge has not changed since July 2013, Meralco said.

Meralco reiterated that it does not earn from the pass-through charges, such as the generation charge, which is the single largest component of the electricity bill. Payment for these charges go to the power suppliers such as the plants selling to Meralco through the WESM and under the PSAs, as well as the IPPs. Meralco’s distribution, supply, and metering charges account for about 18% on the average of the bill.

High summer demand

Meralco expects demand for power to remain high for the rest of the summer season.

Given this, it said it took steps to mitigate a possible tight supply situation.

Meralco signed Interim Power Supply Agreements (IPSAs) with various power suppliers to lessen its exposure to WESM. These IPAs were signed with 1590 Energy Corporation, for the purchase of up to 140 MW capacity of the Bauang plant; and Global Business Power, for the purchase of up to 64 MW capacity of Toledo Power Corporation.

Also, Therma Mobile Inc. is supplying 150 MW to Meralco. This will increase to 200 MW starting April 15 and will go up to 234 MW by end of the month.

Meralco reminded its customers to conserve energy by turning off lights and unplugging appliances when not in use. –

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