With the triple impact of increasing demand due to scorching weather as well as wider economic reopening, relentless outages in power plants and restriction of gas fuel from the Malampaya field, consumers will need to brace for higher electric bills again in their June bills.
According to Manila Electric Company (Meralco), initial calculations portend to “upward pressure on the generation charge for the month of June 2021 due to observed increase in WESM (Wholesale Electricity Spot Market) prices.”
The electricity spot market operator indicated that prices of power supply procured from the WESM climbed significantly to P7.72 per kilowatt hour (kWh) in May supply month compared to a leaner P3.85 per kWh in April.
The cost of spot market-sourced supply of distribution utilities (DUs), including Meralco, will be correspondingly reflected in the bills of consumers this June.
Meralco Vice President and Head of Corporate Communication Joe Zaldarriaga noted that “with the increase in temperature and economic activity, the Luzon grid registered a new peak for the year at 11,556 megawatts.”
The power firm indicated that they are still waiting for all the bills of their power suppliers, but the trajectory of adjustment will be higher for June billing cycle.
Zaldarriaga similarly emphasized that “the average capacity on outage remained at 3,000MW level and the grid was placed on yellow alert on May 5 due to insufficient operating reserves.”
He added that for the rest of May supply month “WESM prices were persistently high for extended periods, triggering the secondary price cap” on May 4 to 7; then on May 20 to 22.
For the secondary price cap in the spot market to be declared, it entails that the primary cap of P32 per kWh had already been hit within prescribed duration of trading intervals.
Earlier forecasts have signified that tight supply conditions, primarily in the biggest power grid of Luzon, may persist until August this year, hence, the DUs are being directed that they must have sufficient contracted supply in their portfolio to meet the demand of their customers.
Zaldarriaga, nevertheless, stated that despite the anticipated increase in electric bills next month “Meralco customers are still experiencing record low power rate levels, as this month’s overall rate was still lower than last year’s rate by P0.1548 per kWh.”
And for consumers to ease their budgets for electricity service, Meralco keeps on apprising them “to continue practicing energy efficiency initiatives at home to be ready in managing their consumption, as the ongoing summer season may bring an increase in residential electricity consumption.”