Net Electricity Rate Decrease Still Almost P1 per kWh for this year

After two consecutive months of power rate reductions, Manila Electric Company (MERALCO) announced today a slight upward adjustment of power rates, as the overall rate for a typical household increased by P0.0278 per kWh, from last month’s P8.8623 per kWh to P8.8901 per kWh this March. This is equivalent to a P6 increase in the total bill of residential customers consuming 200 kWh. This month’s rate is lower than that of last March 2019, which was P10.4961 per kWh.

The slight increase this month is mainly due to a higher generation charge, which was mitigated by a refund of over-recoveries in pass-through charges and a one-time adjustment in Universal Charge-NPC Stranded Contract Costs (UC-SCC).

The March rate reflects the ERC-approved adjustments for MERALCO’s over/under-recoveries in pass-through charges for the period January 2012 to October 2013. These adjustments, to be implemented for a period of three (3) months, are incorporated in the generation, transmission, system loss charges, and subsidies. For residential customers, the adjustments translate to a net reduction of PhP0.05 per kWh, excluding taxes.

ERC directed Meralco to implement a P0.1453 per kWh rate reversal in UC-SCC representing collections in excess of the amount due to Power Sector Assets and Liabilities Management Corporation (PSALM).

WESM leads to higher generation charge

From P4.5090 per kWh last month, generation charge for March increased to P4.6632 per kWh.

Charges from the Wholesale Electricity Spot Market (WESM) increased this month by P1.0479 per kWh, driven by higher power demand and tighter supply conditions in the Luzon grid. Average capacity on outage increased in February with the scheduled maintenance of some power plants. The share of WESM to MERALCO’s supply needs went down to 17%.

On the other hand, cost of power from Independent Power Producers (IPPs) and Power Supply Agreements (PSAs) decreased by P0.0323 per kWh and P0.2950 per kWh respectively. IPPs and PSAs accounted for 83% of total supply.

Adjustments in other bill components

Meanwhile, transmission charge, taxes and other charges registered a decrease of P0.1264 per kWh.

Meralco’s distribution, supply, and metering charges, meanwhile, have remained unchanged for 56 months, after these registered 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. Taxes and other public policy charges like the Universal Charges and the FIT-All are remitted to the government.

Meralco provides energy efficiency tips for customers

As we enter the summer months, Meralco encourages its customers to continue practicing energy efficiency initiatives to help manage their electricity consumption. These include everyday household tips that may help save energy, such as: (i) unplugging appliances when not in use to avoid “phantom load”, (ii) using the aircon at mid-setting or at 25 degrees Celsius for maximum efficiency, (iii) using a power board or strip which can supply power to several appliances at once and allows a user to conveniently turn them off simultaneously with just one switch, and (iv) maximizing natural light during daytime and keeping appliances well maintained to ensure optimal performance. For more helpful tips, customers may visit Meralco’s website at www.meralco.com.ph or its social media accounts, twitter @meralco and facebook at www.facebook.com/meralco. (Meralco/PR)

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