Meralco rates down by 10.5260/kwh

While all other costs of goods and services are threatening to be on uptrend due to newly enforced tax charges, the power rates of Manila Electric Company (Meralco) to its customers will come as an extended holiday gift because it will be down by R0.5260 per kilowatt-hour (kwh) in this January billing.

The utility firm said its overall rate will then be cut to R8.7227 per kwh average from the previous billing cycle’s R9.2487 per kwh.

For typical households in the 200-kilowatt hour consumption bracket, Meralco noted that “the rate decrease amounts to around R105 reduction in the total bill.”

The power utility firm explained that “the lower January rate is mainly due to a R0.5277 per kwh reduction in the generation charge,” asserting further that this is already “the second consecutive month of a decrease in overall electricity rates.”

The two-month stretch of cost reductions, Meralco said, summed up to P0.9045per kwh, coming then as financial relief to consumers.

That partly offset the R0.1168 per kwh hike in the ancillary services component charge of the National Grid Corporation of the Philippines. Taxes and other charges, on the other, had also been lower by R0.1151 per kwh this month.

On the whole, it was emphasized that the generation charge softened to R4.0768 per kwh in this billing month compared to the previous rate of R4.6045 per kwh, mainly due to Meralco’s procurement via its power supply agreements (PSAs) and the lower prices of the Wholesale Electricity Spot Market.

It expounded that “charges from PSAs registered a decrease of R0.9810 per kwh,” primarily due to the reduction in capacity fees “as a result of the annual reconciliation of outage allowances done at the end of each year under the PSAs.”

Meralco said “the reduction in capacity fees of generator-companies represents savings immediately passed on to consumers by way of lower electricity rates.”

Additionally, charges from the WESM had been down by R1.6943 per kwh “due to lower spot prices resulting from a reduction in power demand in the Luzon grid.”

On Meralco’s supply from contracted independent power producers (IPPs), the situation was reversed because their charges had been up by R0.3808 per kwh “due to lower average plant dispatch.” (MMV)