Meralco rates going down anew in January

MANILA, Philippines - Consumers will see a P38 reduction in their electricity bills for the month of January due to lower cost of coal and after the power supply situation returned to normal.

Power distributor Manila Electric Co. (Meralco) said rates would go down by P0.19 per kilowatt-hour for a typical household consuming 200 kwh.

This is equivalent to a decrease of around P38 for the month of January, the third straight month of rate reduction.

“Combining the reduction over this period, overall rates have gone down by P0.79 per kwh compared to October 2014 rates,” Meralco said in its advisory.

The lower cost of coal and normal supply situation drove the generation charge down, Meralco said.

Generation charge, the biggest portion of the bill accounting for roughly 60 percent, has gone down by P0.22 from P4.94 in December 2014 to P4.72 this month, the lowest generation rate in 15 months.

“The reduction in the generation charge was mainly driven by lower charges from the plants under the Power Supply Agreements (PSAs), which registered a reduction of P0.73 per kwh due to the normal operations of the power plants during the December supply month and the lower cost of fuel,” Meralco said.

The lower PSA charges offset increased charges from Independent Power Producers (IPPs) and the Wholesale Electricity Spot Market (WESM), the country’s trading floor for electricity, which increased by P0.24 and P1.68 per kwh, respectively.

WESM charges went up primarily due to the additional payment and compensation to power generators affected by the administered and secondary price cap implementation for the February to July 2014 supply months.

In terms of share to Meralco’s total power requirements for the December supply month, the PSAs, IPPs and WESM accounted for 52, 45 and 3 percent, respectively, data from the distributor showed.

Meanwhile, coal, used in some power plants, went down by almost $2 per metric ton, Meralco added.

But while electricity rates are on the decline, Meralco said this might be difficult to sustain, especially as warmer temperatures set in, coinciding with the shutdown of the Malampaya gas facility sometime from March to April this year.

Meralco urged consumers to save on energy costs by getting the inverter types of appliances, especially for washing machines, air conditioners and refrigerators.

“In the case of refrigerators, for example, consumers can save up to P211 per month with the inverter type compared to the conventional refrigerator. Though inverter types are more expensive to purchase, in the long run, customers may save on them because they are more energy efficient,” it said.