Meralco rates up anew this month

MANILA, Philippines — The rates of Manila Electric Co. (Meralco) rose for four straight months to July this year due to persistently high charges in the wholesale electricity spot market (WESM).?

At a virtual briefing yesterday, Meralco VP and head of corporate?communications Joe Zaldarriaga said the overall rate for a typical household increased by P0.2353 per kilowatt-hour to P8.9071 per kwh this month.?

This is equivalent to an increase of around P47 in the total bill of a residential customer consuming 200 kwh – an increase that was tempered by Meralco’s continued implementation of the distribution rate true-up refund.?

The refund rate is P0.2761 per kwh, which appears in customer bills as a line item called “Dist True-Up” and will last for 24 months from March.?

Meralco said the generation charge, the bill’s largest component, went up P0.2536 per kwh from P4.6171 per kwh to P4.8707 per kwh.?This is because WESM charges remained high at P8.7424 per kwh due to tight supply conditions in the Luzon grid, aggravated by the ongoing Malampaya natural gas supply restriction.?

Zaldarriaga said the Luzon grid was placed on red alert from May 31 to June 2 and on yellow alert on June 4 amid the unplanned shutdown of power plants, which shaved off as much as 4,000 MW of power from the grid.?

In addition, Luzon demand reached 11,640 MW on May 28, the highest so far on record, he pointed out.

“As a result of these, WESM prices were persistently high for extended periods, almost doubling the times when the secondary price cap was imposed during the June supply month.”?

Charges from independent power producers (IPPs) also increased by P0.1929 per kwh.?

“With reduced gas supply from Malampaya, affected plants resorted to the use of more expensive liquid fuel to continue operating and avoid more or longer brownouts,” Zaldarriaga said.?

IPP charges were also pushed up by the peso’s depreciation, as dollar-denominated charges accounted for 97 percent of IPP costs.?

Meanwhile, the cost of power from PSAs decreased by P0.0521 per kwh.?The WESM, IPPs and PSAs provided 7.8 percent, 39.5 percent and 52.7 percent of Meralco’s energy requirement this month, respectively.

?In terms of other charges, transmission charge for residential customers registered a reduction of P0.1463 per kwh due to a significant decrease in ancillary service charges.?However, taxes and other charges registered an increase of P0.1280 per kwh.

The collection of the universal charge-environmental charge remains suspended, as directed by the ERC. Meralco’s distribution, supply and metering charges remained unchanged for 72 months, after these registered reductions in July 2015.