Meralco power rates down by 30c this month
Customers of Manila Electric Co. (Meralco) will pay less for using electricity as the power distributor announced lower electricity rates in October following successive increases in the last few months.
Meralco announced that power rates dropped by P0.3587 per kilowatt-hour for the October billing period, lowering this month’s overall rate to P11.4295 per kWh from P11.7882 per kWh.
This translates to a decrease of P72 for residential consumers with a monthly consumption of 200 kWh.
Meralco said this was mainly driven by the P0.3059 per kWh reduction in the generation charge, caused by lower costs from the Wholesale Electricity Spot Market (WESM), where electricity is traded as a commodity.
WESM rates dropped by P5.1001 per kWh after it finished collecting the deferred May 2024 costs ordered by the Energy Regulatory Commission (ERC) and the improved supply situation in the Luzon grid.
The distribution utility said the significant decline in WESM prices “more than offset increases” from other charges.
Particularly, rates from independent power producers and power supply agreements rose by P1.8556 per kWh and P0.1128 per kWh, respectively.
The transmission charge went down by P0.0383 per kWh because of the lower cost of ancillary service (AS) or reserve power that is used to balance and stabilize the grid during power supply-demand imbalance.
Taxes and other charges dipped by P0.0145 per kWh while Meralco’s distribution charge remained unchanged after it applied the P0.0360 per kWh decrease in August 2022.
Other charges
In a briefing on Friday, Meralco vice president and head of utility economics Lawrence Fernandez said the rate adjustment in the coming months would depend on certain factors.
Fernandez said Meralco customers might pay more if the ERC authorized grid operator National Grid Corp. of the Philippines (NGCP) to collect the remaining 70 percent AS cost which was deferred earlier and approved a higher feed-in-tariff allowance (FIT-All) sought by National Transmission Corp.
FIT-All is one of the charges in an electricity bill used to incentivize developers to build cleaner sources of energy.
Meralco spokesperson Joe Zaldarriaga noted that electricity consumption declines during “ber” months based on historical data.
“Consumption usually spikes during the summer months and tapers off pagpasok ng rainy season (at the onset of the rainy season), especially during ber months,” he said.
“As far as overall electricity bills are concerned, I think aside from the rates, consumption will also soften. That’s why we can probably comparatively see much lower power costs compared to the summer months,” he added.
