Meralco raises power rates by P0.47/kWh for November

Customers of Manila Electric Co. (Meralco) will pay higher electricity bills this November, the power distributor said Thursday, citing a slight increase in electricity rates.

Meralco raised electricity rates by P0.4717 per kilowatt-hour (kWh), translating to an increase of P94.34 for a typical household consuming 200 kWh.

The upward adjustment brought the overall household rate this month to P9.5579 per kWh from P9.0862 per kWh.

This is the second straight month that the power distributor raised power rates.

Despite the increase, November rate is still P1 lower than April's rate of P10.56 per kWh, the company said.

Last month, Meralco also announced “a slight upward adjustment” in power rates, saying the “overall electricity rates for a typical household consuming 200kWh increased to P9.0862 per kWh this October from last month’s P9.0414 per kWh.”

Meralco said higher generation charge for November was brought about by price increases at Wholesale Electricity Spot Market (WESM).

“From P4.5406 per kWh last month, the generation charge for November increased to P5.0317 per kWh, an upward adjustment of P0.4911 per kWh,” it said.

“Charges from the WESM increased by P3.8016 per kWh driven by tighter supply conditions in the Luzon grid.”

The National Grid Corporation of the Philippines (NGCP) placed the grid under yellow alert on October 14 and 15 due to forced outages of several power plants and the maintenance shutdown of the Malampaya natural gas facility from October 12 to 15.

“In addition, WESM charges rose as the Net Settlement Surplus (NSS) refund—ordered by the Energy Regulatory Commission (ERC) last August 1, 2019—was significantly lower for November, at around P21 million only,” the power distributor said.

The refund last September and October totaled approximately P1 billion, which greatly contributed to the lower generation charges for the two prior months.

The NSS refund is expected to end this month.

The share of WESM to Meralco’s supply needs was at 16%.

The cost of power from the Independent Power Producers (IPPs) and Power Supply Agreements (PSAs) decreased by P0.0476 per kWh and P0.2643 per kWh, respectively, due to higher average plant dispatch, lower coal prices, and the strengthening of the peso against the US dollar.

Around 97% of IPPs costs and 60% of PSA costs are dollar-denominated, according to Meralco.

IPPs and PSAs provided 39% and 45% of Meralco’s supply needs, respectively.

Transmission charge for residential customers decreased by P0.0767 per kWh as a result of lower NGCP ancillary service charges.

Taxes and other charges registered an increase of P0.0573 per kWh.

Meralco said its distribution, supply, and metering charges have remained unchanged for 52 months, after registering reductions in July 2015.

“Meralco reiterated that it does not earn from the pass-through charges, such as the generation and transmission charges. Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the NGCP,” it said.

“Taxes and other public policy charges like the FIT-All are remitted to the government,” it added. —Ted Cordero/VDS, GMA News