Meralco slashes power rates in December

In time for the Christmas holidays Customers of Manila Electric Company (Meralco) will expect lower electricity rates this month, as the power distributor slashed its rates for December.

In an advisory issued Wednesday, Meralco said it reduced the overall rate for a typical household by P0.0352 per kilowatt-hour (kWh) to P8.4753 per kWH from P8.5105 per kWh in November.

The rate adjustment is equivalent to a decrease of around P7 in the total bill of residential customers consuming 200 kWh.

“This month’s overall rate is also a net rate reduction of P1.3870 per kWh, equivalent to bill reduction of more than P277 for a 200 kWh household, since the start of the year,” Meralco said.

“This the second lowest overall power rate in more than three years, or since September 2017,” it added.

The company attributed the overall rate reduction to the decrease in generation charge by P0.0502 per kWh to P4.1516 per kWh from November’s P4.2018 per kWh.

“All sources of supply registered lower charges this month,” it said.

WESM

Meralco said there was a P0.1881 per kWh reduction in charges from the Wholesale Electricity Spot Market (WESM). 

The Luzon grid’s power supply situation improved in November following a drop in demand which decreased due to successive  weather disturbances, the power distributor said.

From October 2020’s peak demand of 10,344 megawatts (MW), November 2020 peak demand decreased to 9,886 MW.

Also, due to the effects of Typhoon Ulysses, the WESM was suspended by the Energy Regulatory Commission from November 12 to 13, 2020.

Meanwhile, the cost of power from the Independent Power Producers (IPPs) also decreased by P0.2577 per kWh due to improved average plant dispatch and peso appreciation, Meralco said.

Likewise, charges from Power Supply Agreements (PSAs) also went down by P0.0214 per kWh with the strengthening of peso against the US dollar.

WESM, IPPs, and PSAs accounted for 9%, 39%, and 52% of Meralco’s energy requirements, respectively.

On the other hand, transmission charge for residential customers registered a slight reduction of P0.0044 per kWh due to lower Power Delivery and Ancillary Service Charges.

Meanwhile, taxes, and other charges registered a net increase of P0.0194 per kWh.

Collection of the Universal Charge-Environmental Charge amounting to P0.0025 per kWh remains suspended, as directed by the ERC.

Meralco noted that its distribution, supply, and metering charges, meanwhile, have remained unchanged for 65 months since July 2015.

The company reiterated that it does not earn from the pass-through charges, such as the generation and transmission charges.

It said payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the National Grid Corp. of the Philippines.

Taxes and other public policy charges like the Universal Charges and the FIT-All are remitted to the government, Meralco said. — RSJ, GMA News