Global fuel crunch raises power rates in Zambales
SAN ANTONIO, ZAMBALES—Electricity consumers in parts of this province are expected to see higher power bills this April as rising global fuel prices and increased transmission charges push up the overall cost of electricity, the Zambales II Electric Cooperative (Zameco II) said on Wednesday.
The distribution utility said the effective electricity rate for April increased to P9.3839 per kilowatt-hour from P7.3693 per kWh in March, representing an overall hike of P2.0146 per kWh.
Zameco II provides electricity supply to 95,000 member-consumers in the towns of San Antonio, San Marcelino, San Narciso, San Felipe, Cabangan, Botolan, Palauig, Candelaria, Masinloc, and the provincial capital Iba.
The increase was mainly driven by higher generation charges, which utilities attributed to the continuing global energy crisis linked to the recent outbreak of conflict in the Middle East that have affected the supply and price of imported fuel.
Higher costs
The country is wholly dependent on petroleum supply from the Middle East which continues to be rocked by tensions between Iran, on the one hand, and the United States and Israel, on the other.
According to Zameco II, the situation has led to higher shipping and procurement costs, raising expenses in electricity generation that are eventually passed on to consumers by power generation companies.
Transmission charges imposed by the National Grid Corp. of the Philippines (NGCP) rose due to increased costs for ancillary services, particularly regulating reserves used to maintain the stability of the power grid during supply-demand imbalances.
In a statement, the NGCP showed that the overall equivalent average transmission rate for the March billing period—reflected in April bills—rose by 4.26 percent to P1.7526 per kWh, from P1.6810 per kWh in February.
Ancillary service rates increased from P0.8275 per kWh to P0.8516 per kWh, while the transmission wheeling rate, or the fee charged for delivering electricity through the transmission grid, slightly rose to P0.7022 per kWh from P0.6677 per kWh in the previous billing cycle.
The NGCP clarified that it does not profit from ancillary service charges, explaining that these costs are directly remitted to power generators providing reserve power and to the Independent Electricity Market Operator of the Philippines for services sourced from the reserve market.
Meanwhile, Zameco II said its distribution, supply and metering charges have remained unchanged since February 2011, in accordance with a ruling by the Energy Regulatory Commission.
The cooperative added that fluctuations in monthly electricity prices are largely caused by generation and transmission charges, which are pass-through costs that distribution utilities collect but do not directly earn from.
Situation in Mindoro
In Mindoro, which remains an off-grid island, the disruptions in global oil supply are also expected to raise electricity rates, a nongovernment think tank projected.
The Oriental Mindoro Electric Cooperative Inc. (Ormeco) and the Occidental Mindoro Electric Cooperative Inc. (Omeco) both rely heavily on bunker fuel for power generation—100 percent in the case of Ormeco and over 40 percent for Omeco.
“Global oil disruptions are pushing electricity rates higher, and the national energy emergency highlights Mindoro’s vulnerability—just as people’s need for reliable electricity becomes more critical due to the summer heat,” said Gerry Arances, executive director of the Center for Energy, Ecology and Development (CEED).
According to CEED, recent spikes in global oil prices could lead to significant increases in electricity rates, estimating potential hikes of P3.81 per kWh for Ormeco and P2.75 per kWh for Omeco. —WITH A REPORT FROM MADONNA T. VIROLA
