Meralco charges only what is allowed by law

The Manila Electric Co. (Meralco) stressed yesterday that they are charging only what is allowed by law as it branded as “rehashed and unsubstantiated” the claim of National Association of Electricity Consumers for Reforms (Nasecore) president Pete Ilagan that there is a devious effort to fool the public.

Ilagan earlier charged that Meralco’s total cost per kilowatthour is only averaging P4 when it is really more than what other distributors charge their customers.

“Residential customers consuming up to 50 kilowatt-hour are charged P 4.45 per kwh, P5.80 per kwh for those consuming up to 70 kwh, and P7.16 per kwh for those consuming up to 100 kwh. These customers represent more than half of Meralco’s total residential base,” Meralco vice president for corporate communication Elpi Cuna Jr. said.

“I also would like to emphasize that what goes to Meralco are merely the supply, metering and distribution charge. The rest are merely pass-through costs and the bulk of which goes to generation. To add, Meralco rates were designed by the government to favor small consumers — small consumers are charged lower distribution rates and those consuming more are charged higher rates. It is called socialized pricing,” he added.

“More specifically, this means that the distribution rate to a Meralco residential customer using 200 kilowatt-hours a month is only P1.37/kwh, among the lowest in the Philippines.”

“For a consumer using 200 kwh a month or less, the distribution rate in Cebu is P1.47/kwh, in Davao P1.64/kwh and in Cagayan de Oro P2.04/kwh – all higher than Meralco’s. Households that use up to 200 kwh a month account for 77 percent of all Meralco residential customers,” he said. 

Cuna stressed Meralco is just a collector for other charges other than distribution fees.

“We would like to emphasize that aside from the Meralco distribution charges, everything else in the total electricity bill is merely being collected by Meralco on behalf of other entities like the power suppliers for generation cost, TransCo for transmission cost, and the government for taxes.”

“The problem with Ilagan is that he keeps comparing the total electricity cost of Meralco with distribution utilities in Visayas and Mindanao without telling the public that the cost of transmission and generation in Visayas and Mindanao is very much lower compared to the transmission and generation cost in the Luzon grid,” Cuna stressed.

A comparison between Meralco distribution rates in June 2003 (the last time Meralco was granted a rate increase) and June 2008 will reveal that the company’s charges even decreased by 17.