Meralco power rates to go down this month

MANILA, Philippines - The Manila Electric Co. (Meralco) is cutting power rates this month based on the lower cost of power bought from independent power producers (IPP).

“The generation cost of Meralco’s suppliers reflected a significant decrease, mainly triggered by a considerable reduction in fuel cost last April,” Meralco vice president and head of utility economics Ivanna de la Peña said.

Meralco’s decision to slash rates came on the heels of a 59.70-centavo drop in the generation charge, from P5.0205 per kilowatt-hour last April to P4.4235 per kwh this month.

A residential client who paid P733.72 for 100 kwh of electricity consumed in April is expected to pay P57.62 less this month.

For a 200-kwh per month consumption, charges will be P165.02 less this month.

De la Peña noted that the price of natural gas used by the First Gas Corp. plants declined from $10.69 per Gigajoule to $7.46 /GJ for April. 

First Gas-operated Sta. Rita plant, which contributed 28.9 percent of the electricity distributed by Meralco, cut its power cost by P1.75 per kwh while another First Gas facility – San Lorenzo – reduced its power cost by P1.11.

Power supply from San Lorenzo represents 14.6 percent of electricity distributed by Meralco.

Meralco’s other IPP, Quezon Power, which supplied 12.8 percent of Meralco’s requirement, reported a 70.90-centavo decrease in power cost.

The average National Power Corp. (Napocor) rate also went down by 19.55 centavos. 

Napocor supplies 36.4 percent of Meralco’s energy requirements.

The IPP rate reductions tempered the P1.42 per kwh increase in wholesale electricity spot market or WESM prices. Meralco gets 7.4 percent of its supplies from WESM.

Meralco will also be adjusting other electricity bill components for the May 2009 billing month.

Last April, the Energy Regulatory Commission (ERC) approved Meralco’s petition to adjust distribution-related charges.

At the same time, the regulatory body directed Meralco to accelerate the Currency Exchange Rate Adjustment or CERA refund, from four centavos per kwh implemented in March to 14.61 centavos per kwh this month.

In addition, transmission charges will go down by an average of 16.5 centavos per kwh as part of the annual updating of transmission charges as provided for under ERC’s Transmission Rate Adjustment Mechanism or TRAM. System loss charges will also drop due to reduced generation and transmission charges.