Meralco rate to increase in May billing

Published May 7, 2021, 3:01 PM

by Myrna M. Velasco

The customers of Manila Electric Company (Meralco) will need to earmark slightly higher budget for their electric bills this month, as the utility firm’s overall tariff had gone up by P0.1853 per kilowatt hour (kWh) to P8.5920 per kWh from the last billing cycle’s P8.4067 per kWh.

For residential end-users in the typical 200-kWh consumption band, the equivalent increase will be P37, according to the power firm.


Meralco qualified that this month’s upward adjustment in rates had been tempered by the continued implementation of the refund of the true-up or cost adjustment relating to the firm’s distribution charges – and that refund process began in March billing this year.

That pay-back to customers – to be stretched over 24 months and at the level of P0.2761 per kWh for residential users – had been anchored on the provisional approval of the Energy Regulatory Commission (ERC) on Meralco’s bid to refund P13.9 billion worth of cost-adjustments relating to its actual weighted average tariff (AWAT) that had been determined under performance-based rate setting for the periods from July 2015 to November 2020.

Across tariff components, Meralco emphasized that generation charges marginally inched up by P0.0104 per kWh to P4.5474 per kWh versus last month’s P4.5370 per kWh.

On the other cost items, the transmission charge relating to the ancillary services procurement of the system operator had been higher by P0.0933 per kWh, mainly due to “completion of transmission refund,” while taxes and other charges also posted a net increase of P0.0816 per kWh.

Meralco similarly apprised consumers that the collection of universal charge-environmental charge amounting to P0.0025 per kWh remains suspended in this billing cycle.

In particular, the power firm indicated that charges from capacity procured via its power supply agreements (PSAs) had been higher by P0.2541 per kWh “due to low dispatch of San Gabriel as a result of the ongoing restriction of Malampaya natural gas supply.”

Conversely, Meralco’s supply purchases from its contracted independent power producers (IPPs) had been lower by P0.1921 per kWh; while sourcing from the Wholesale Electricity Spot Market (WESM) had been at high prices “due to tight supply conditions in the Luzon grid as capacity on outage stayed above 3,300 megawatts and Luzon peak demand in April still exceeded 10,400MW.”

In terms of portfolio share, Meralco noted that PSAs cornered the biggest share at 52-percent; then IPPs had 41-percent fraction in the pie; while its WESM exposure was at the scale of 7.0-percent for the month.

But while electricity demand is still treading peak during the summer months, the power company has reiterated its appeal to consumers to practice energy efficiency as well as conservation on their electricity usage.

Ferdinand O. Geluz, first vice president and chief commercial officer of Meralco, asserted that the hotter temperature in these months  typically trigger spike in electricity consumption – and that will not just strain power supply in the system, but it could also result in higher electric bills.