Consumers of Manila Electric Company (Meralco) will benefit from a slight reduction of P0.0623 per kilowatt hour (kwh) in this September billing — summing up five straight months of tariff downtrends for this year.
For end-users in the consumption threshold of 200 kilowatt hours (kwh), the average cost savings they will gain in this billing period will be P12, according to the utility firm. The overall rate billed this month is at P8.4288 per kwh versus the previous month’s P8.4911 per kwh.
The generation charge, which accounts for the chunk of the cost components being passed on, had been pared by P0.0381 per kwh this month to P4.0860 per kwh from the previous billing cycle’s P4.1241 per kwh.
Additionally, the transmission charge was on marginal decline of P0.0112 per kwh and that was mainly attributed to the lower ancillary services (AS) charges of the National Grid Corporation of the Philippines; while taxes and other charges incurred a net decrease of P0.0130 per kwh.
Meralco emphasized one key factor that triggered rate reduction this September is its continuing move to invoke force majeure (FM) claims with its power suppliers.
“This September, the force majeure claim totaled about P463 million, equivalent to customer savings of P0.1710 per kwh in the generation charge,” the utility firm noted.
The company explained that if the FM claims had not been there, “the generation charge and the total rate would have increased by P0.13 and P0.14 per kwh, respectively.”
Since March this year when Meralco has been persistently invoking FM claims under its power supply deals, the company was already able to generate P2.4 billion worth of savings that it has been passing on as rate reduction to customers via their electric bills.
On supply procurement, Meralco indicated that it secured the lion’s share of 54.8-percent from its power supply agreements (PSAs) and that resulted in a decrease of P0.3032 per kwh on its charges.
The fraction of supply sourced from its contracted independent power producers (IPPs) had been at 33.6-percent; and this went up by P0.0601 per kwh; while volume procured from the Wholesale Electricity Spot Market (WESM) stood at 11.6-percent and charges had been down by P0.0147 per kwh.
The lower settlement prices in the spot market, it was noted, had been due to decrease in Luzon demand — given the re-enforcement of modified enhanced community quarantine (MECQ) in some areas last month, primarily in Metro Manila and neighboring provinces.