Meralco rates down for the fifth month straight month

Published September 12, 2019, 5:53 PM

by Martin Sadongdong & Antonio Colina

MANILA, Philippines, 9th September 2019 – The Manila Electric Company (MERALCO) announced today the fifth consecutive month of lower power rates, as overall electricity rates for a typical household consuming 200kWh decreased to P9.0414 per kWh this September from last month’s P9.5674 per kWh.

Meralco RATES-SEPT-2019-B

The downward adjustment of P0.5260 per kWh will mean a decrease of around P105 in the typical household’s total bill.

The fifth straight month of electricity rate decrease represents a total downward adjustment of almost P1.52 per kWh since April 2019.

Lower WESM charges lead to overall generation charge decrease

From P4.9620 per kWh last month, generation charge for September went down to P4.5191 per kWh, a decrease of P0.4429 per kWh.

The generation charge decrease is primarily due to lower charges from the Wholesale Electricity Spot Market (WESM).

WESM charges decreased by P3.6503 per kWh mainly due to improved supply conditions in the Luzon grid.

The National Grid Corporation of the Philippines (NGCP) did not declare any Yellow or Red Alerts during the whole supply month as compared to 9 yellow alerts in July.

Contributing to the lower WESM rate is the refund of Net Settlement Surplus (NSS) as directed by the ERC in its Order dated August 1, 2019. The share of WESM to Meralco’s supply needs went up to 17%.

The cost of power from the Power Supply Agreements (PSAs) decreased by P0.1522 per kWh due to lower fuel prices. On the other hand, cost of power from the Independent Power Producers (IPPs) increased by P0.4844 per kWh because of lower average plant dispatch and weakening of the Peso against the US Dollar.

Around 95% of IPPs costs are dollar-denominated. PSAs and IPPs provided 44% and 39% of Meralco’s supply needs, respectively.

Movements in Transmission and Other charges

This month, transmission charge for residential customers slightly increased by P0.0056 per kWh. This was offset as taxes and other charges registered a decrease of P0.0886 per kWh.

Meralco’s distribution, supply, and metering charges, meanwhile, have remained unchanged for 50 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 rate are remitted to the government.

Meralco provides energy efficiency tips for customers

Meralco 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, such as: (i) unplugging appliances when not in use to avoid “phantom load”, (ii) using the aircon at mid-setting or at 25 degrees Celsius for maximum efficiency, (iii) 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 with just one switch, and (iv) maximizing natural light during daytime and keeping appliances well maintained to ensure optimal performance.

For more helpful tips, customers may visit Meralco’s website or its social media accounts, twitter @meralco and facebook page.