Power rates in Metro Manila will go up for the third consecutive month this January, mainly due to a higher generation charge and the completion of distribution-related refunds, according to the Manila Electric Co. (Meralco).
The P0.6232 per kilowatt hour (kWh) upward rate adjustment brings the overall power rate to P10.90 from last month’s P10.28 per kWh.
This is also equivalent to an increase of around P125 in the total bill of residential customers consuming 200 kWh monthly.
Meralco said the generation charge went up by P0.3316 to P7.1291 from P6.7975 per kWh.
The company said charges from independent power producers (IPPs) were higher by P0.4070 per kWh mainly due to the increased use of more expensive alternative fuel by natural gas-fired power plants due to insufficient supply of their fuel. However, the peso’s appreciation which affected 97 percent of IPP costs that are dollar-denominated, mitigated a further increase in power rates.
Meanwhile, the Wholesale Electricity Spot Market (WESM) charge also increased by P0.6808 per kWh as the increase in average generation capacity on outage more than offset the decrease in power demand in the Luzon grid.
Charges from power supply agreements (PSAs), meanwhile, went down by P0.2710 per kWh due to higher share of excess energy deliveries which are priced at a discount and the appreciation of the peso against the dollar since around 36 percent of PSA costs are dollar-denominated.
Another factor that pushed power rates up is the completion of a distribution-related refund equivalent to P0.2761 per kWh for residential customers.
Meralco said the two ongoing refunds totaling P1.0579 per kWh for residential customers are still being implemented by Meralco and continue to temper customers’ monthly bills. They are also expected to be completed this month and in May.
On the other hand, Meralco’s transmission charge for residential customers decreased by P0.0314 per kWh due to lower ancillary service charges while taxes and other charges registered an upward adjustment of P0.0469 per kWh.
Collection of the Feed-In Tariff Allowance also remains suspended following the issuance of the Energy Regulatory Commission’s Resolution halting the collection of P0.0364 per kWh FIT-All rate from December 2022 to February 2023.
The company reiterated it only earns from distribution, supply and metering charges, which went down by P0.0360 per kWh in August 2022.
The company said that the total power requirements for the month was traced as 9 percent from WESM, 46 percent from IPPs and 45 percent from PSAs.
