Electricity rate decreases again this January

Published January 16, 2018, 12:00 AM

by manilabulletin_admin

To start the new year, Meralco announced a decrease in electricity rates for January 2018, amounting to P0.5260 per kWh for a typical household, thereby bringing down the overall rate from last month’s P9.2487 per kWh to P8.7227 per kWh.


 The rate decrease this month amounts to around P105reduction in the total bill of a typical residential customer consuming 200kWh.

The lower January rate is mainly due to a P0.5277 per kWh reduction in the generation charge. This is the second consecutive month of a decrease in overall electricity rates, totaling a reduction of P0.9045 per kWh in the two-month span.

Lower PSAsand WESM charges bring down the generation charge

Generation charge decreased from P4.6045 per kWh in December to P4.0768 per kWh this January primarily due to lower Power Supply Agreements (PSA) and Wholesale Electricity Spot Market (WESM)charges.

 Charges from PSAs registered a decrease of P0.9810 per kWh. The lower PSA charges were brought about by a reduction in capacity fees as a result of the annual reconciliation of outage allowances done at the end of each year under the PSAs approved by the Energy Regulatory Commission (ERC).

The reduction in capacity fees of generator companies represents savings immediately passed on to consumers by way of lower electricity rates. The capacity fees from PSAs will return to normal levels after the downward adjustment this month. PSAs provided 40 percent of Meralco’s total energy requirement.

 Charges from the WESM also decreased by P1.6943per kWh due to lower spot prices resulting from a reduction in power demand in the Luzon grid. The share of WESM purchases to Meralco’s total requirement this month was 19 percent.

 On the other hand, charges from the Independent Power Producers (IPPs) increased by P0.3808 per kWh due to lower average plant dispatch. The share of IPP purchases to Meralco’s total requirement this month was at 41 percent.

Increase in transmission charge offset by other charges

Transmission charge of residential customers increased by P0.1168 per kWh due to higher NGCP ancillary service charges, but this was offset as taxes and other charges went down by P0.1151 per kWh this month.

 Meralco’s distribution, supply, and metering charges, meanwhile, have remained unchanged for 30 months, after these registered reductions in July 2015. Meralco reiterated that it does not earn from the pass-through charges, such as the generation and transmission charges. Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the NGCP.  Taxes and other public policy charges like the FIT-All are collected by government.

Meralco provides energy efficiency tips for customers

As summer approaches, Meralco once again encourages its customers to continue practicing energy efficiency initiatives to help manage their electricity consumption. These include everyday household tips that may help save energy.

These are simple tips such as unplugging appliances when not in use to avoid “phantom load;” using the aircon at mid-setting or at 25 degrees Celsius for maximum efficiency; using a power board or strip which can supply power to several appliances at once and allows a user to conveniently turn them off simultaneously using just one switch; maximizing natural light during daytime and keeping appliances well maintained to ensure optimal performance.

For more helpful tips, customers may visit Meralco’s website at www.meralco.com.ph or its social media accounts, twitter @meralco and facebook at www.facebook.com/meralco.