The household budgets of customers served by power utility giant Manila Electric Company (Meralco) will be stretched thin this February, because the all-inclusive electricity rate to be passed on by the giant utility firm is anticipated to increase in this billing cycle.

According to Meralco Vice President Joe Zaldarriaga, the company has yet to receive all invoices from power suppliers, but “initial indications show that there may be an upward pressure for electricity bills this month.”

The power firm emphasized that the final figure of the projected rate hike will only be reckoned once they already received all billings from contracted independent power producers (IPPs), power supply agreements (PSAs) as well as from the operator of the Wholesale Electricity Spot Market.

The preliminary factors seen triggering upticks in Meralco tariff this month are the resumption of collection of the P0.0364 per kilowatt hour (kWh) feed-in-tariff allowance (FIT-All) component in the electric bills; as well as upward pressure on fuel prices – primarily the imported liquefied natural gas (LNG) being fed to the power plants for electricity generation.

“There is pressure on the generation charge to go up driven by higher fuel prices, particularly of imported liquefied natural gas (LNG) used by gas-fired power plants,” Zaldarriaga specified.

In particular, the 1,200-megawatt Ilijan gas-fired power facility of San Miguel subsidiary South Premiere Power Corporation (SPPC) is now running on LNG; and it goes the same way with some plants of First Gen Corporation of the Lopez group – and these are fleets supplying power capacities to Meralco.

Beyond the run-up in fuel prices, Meralco indicated it is still pinning hopes on downtrend in the settlement prices at the WESM as a key factor that may ease anticipated hikes in the bills of its roughly 8.0 million customers. The power company is targeting to announce the rate adjustments on Thursday (February 8).

“We hope that this will somehow be mitigated by lower WESM prices, as well as the lower energy demand due to the cool weather during the January supply month,” the Meralco executive noted.

In the months ahead, Filipino consumers have already been forewarned of distressing summer months – not just due to the rising temperatures; but even on financial squeeze to their pockets due to surging electric bills, as well as probable torment of service interruptions or rolling brownouts.

The incursion of El Nino phenomenon this year could render unavailability of generation capacity from the hydro plants; and that could worsen the already tight supply predicament of Luzon grid, which is also the major economic center of the country.

The power generation capacity from more solar plants could have been viable addition to the country’s power supply within the stretch of the summer months, but most of the awarded contracts under the Department of Energy-administered green energy auction (GEA) will have their commercial delivery dates by the end of this year yet.