Customers of the Manila Electric Co. (Meralco) will enjoy a reduction of 45 centavos per kilowatt-hour (kWh) in their electricity bill this month.
Meralco was able to lower its generation charges through the use of “banked” gas by two of its independent power producers (IPPs), which are run by natural gas.
“Natural gas that was contracted but not consumed for a certain year is banked for future use,” said Ivanna de la Peña, vice president and head of utility economics of Meralco.
Every year, after the contracted quantities are consumed, the natural gas plants start to utilize banked gas.
In the case of First Gas Sta. Rita, banked gas comprised 50 percent of its fuel consumption in November. For First Gas San Lorenzo, was 60 percent.
The cost of banked gas is more than 50 percent lower than the cost of the high-priced natural gas that was responsible for the increase in the generation charge for November 2008.
De la Peña added that the overall IPP rate went down by over P1.02 per kWh while that from the National Power Corp. (Napocor) was reduced by 17 centavos per kWh. The cost of power sourced from the Wholesale Energy Spot Market (WESM), however, increased by P2.08 per kWh.
In November, the IPPs supplied 51.6 percent of Meralco requirements; Napocor, 38.6 percent; and WESM, the remaining 9.7 percent.