Manila Electric Company (Meralco) announced that residents will see a ₱0.2639 per kilowatt-hour (kWh) increase in this month’s billing.
In a statement on Tuesday, March 11, Meralco reported that the overall rate for a typical household would be raised from ₱12.0262/kWh to ₱12.2901/kWh.
Residents consuming 200 kWh will see a ₱53 increase in their March bill; those with 400 kWh will face a ₱106 rise; and households using 500 kWh will experience a ₱132 adjustment.
According to Meralco, the price movements are driven by the conclusion of the one-time downward adjustment on the reset fee implemented last month.
“[The reset fee] equivalent to ₱0.2264/kWh for Meralco customers was implemented in February as ordered by the Energy Regulatory Commission (ERC),” it stated.
To recap, the ERC directed Meralco to refund approximately ₱987 million in unused regulatory reset fees to its customers; this reduction dampened February’s rates.
Aside from the absence of the reset fee, transmission charges had a ₱0.1294/kWh spike due to higher ancillary service charges assumed by the National Grid Corporation of the Philippines (NGCP).
“This month’s transmission charge also includes the second of three installments of February and March 2024 reserve market transactions for Luzon that the ERC directed NGCP to collect,” Meralco elaborated.
Another factor contributing to this month’s billing hike was the increase in the feed-in tariff allowance (FIT-All), a charge that supports renewable energy (RE) integration.
Meralco reported that FIT-All was raised to ₱0.0351/kWh after the ERC ordered a new rate of ₱0.1189/kWh starting in March.
Other charges had a net increase of ₱0.0416/kWh.
Despite these drivers, generation charges dropped from ₱7.2203/kWh to ₱7.0517/kWh due to lower costs from the distribution utility’s (DU) supply sources.
Other factors that offset the price spike were lower charges from independent power producers (IPPs) at ₱1.0143/kWh and power supply agreements (PSAs) at ₱0.2934/kWh.
Because of increased power supply in Luzon, the Wholesale Electricity Spot Market (WESM) prices eased down by ₱0.2247/kWh.
Meralco’s distribution charge remains unchanged at ₱0.0360/kWh.
As we enter the summer months, Meralco anticipates minimal changes to consumer power rates.
Larry Fernandez, Meralco’s head of utility economics, explained in a briefing that there has been a moderate movement in demand in March, however, expects that consumption may begin to rise in April.
“There has been one instance of a yellow alert [last week] and because of that we expect the spot market prices to go up,” he said.
Meanwhile, Joe Zaldarriaga, Meralco vice president and head of corporate communications, urged consumers to practice electrical safety measures not only to reduce costs but also to prevent safety hazards, such as the risk of fire.
“We remind our customers to observe electrical safety especially with the dry season fast approaching since many household fires usually start from faulty wiring, overloaded outlets, or improper use of appliances,” he said.