power and water

Thin power supply pushes Meralco rates up in June 2021

Aika Rey
Manila Electric Company rates increase by P0.0798 per kilowatt-hour
Thin power supply pushes Meralco rates up in June 2021

Tight supply conditions in the Luzon grid pushed up Manila Electric Company’s (Meralco) rates in June.

On Friday, June 11, Meralco said this month’s bill has a slight upward adjustment of P0.0798 per kilowatt-hour to P8.6718 per kWh, mainly due to higher charges in the Wholesale Electricity Spot Market (WESM).

This is equivalent to increases for households consuming the following, for example:

  • P15.96 for 200 kWh
  • P23.94 for 300 kWh
  • P31.92 for 400 kWh
  • P39.90 for 500 kWh

The overall rate in June still includes the distribution rate true-up refund worth P0.2761 per kWh, which slightly tempered the upward adjustment in charges.

Generation charges increased by P0.0697 per kWh to P4.6171 per kWh, as power spot prices increased by P1.6322 per kWh due to the thin supply in the Luzon grid brought by plant outages.

“With the increase in temperature and economic activity, demand in the grid increased by 1,131 MW from 10,425 MW in April to 11,556 MW in May. The Luzon grid was placed on yellow alert on May 5, due to insufficient operating reserves as average capacity on outage remained at the 3,000-MW level,” Meralco said.

Spot market prices were consistently high for extended periods, triggering the imposition of a secondary price cap from May 4 to 7 and then from May 20 to 22.

Charges from power supply agreements (PSAs) and independent power producers (IPPs) decreased by P0.0476 per kWh and P0.0037 per kWh, respectively, due to improved plant dispatch and peso appreciation.

The share of WESM in Meralco’s energy requirement for the June bill was further down to 6%, while PSAs and IPPs provided 52% and 42%, respectively.

The transmission charge, meanwhile, slightly increased by P0.0101 per kWh, while the collection of the environmental charge amounting to P0.0025 per kWh remains suspended as ordered by the Energy Regulatory Commission. – Rappler.com

Aika Rey

Aika Rey is a business reporter for Rappler. She covered the Senate of the Philippines before fully diving into numbers and companies. Got tips? Find her on Twitter at @reyaika or shoot her an email at aika.rey@rappler.com.