Higher Meralco rates likely in October bill

Customers of Manila Electric Co. (Meralco) might pay more for electricity this month as power generation charges could rise.

“This is due to the depreciation of the peso, which affects costs of our suppliers that are mostly dollar-denominated,” Joe Zaldarriaga said in a statement on Tuesday. He is vice president and head of corporate communications at Meralco.

The generation charge accounts for more than half of the monthly electricity bill.

With the US dollar gaining more ground against the local currency, this means that costs related to power producers and supply deals that are dollar-denominated could become more expensive.

But Zaldarriaga remained optimistic that the possible hike could be softened by the reduction in prices at the spot market.

On Monday, the Independent Electricity Market Operator of the Philippines (IEMOP) said the prices of electricity traded at the spot market dropped by 33.8 percent in September. This settled to its lowest in the last seven months.

IEMOP operates the Wholesale Electricity Spot Market. It is a platform where power is traded between producers and distributors to boost their supply.

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The systemwide power rates covering the September supply declined to P3.04 per kilowatt hour (kWh) from the previous month’s P4.59 per kWh. This will reflect in consumers’ October bills.

This, as the supply volume slightly rose to 20,712 megawatts (MW). Meanwhile, demand fell by 2.9 percent to 13,640 MW.

All three major island groups booked lower prices amid weaker demand. Both the Visayas and Mindanao grids saw a 37-percent drop in prices.