Meralco sales growth seen at 4.9% in 2017
The energy sales growth of Manila Electric Company (Meralco) still picked up on a robust pace of 4.9 percent in 2017, even if it already came from a high base of 8.6 percent sales growth in 2016.
Meralco President Oscar S. Reyes indicated that industrial and commercial segments have had very solid showing when it comes to demand growth, and that largely contributed to sales gaining traction last year.
“We might end 2017 with 4.9 percent against a high base of 8.6 percent in 2016,” he stressed, emphasizing that “surprisingly industrial had strong growth, so as with commercial.”
Nevertheless, the utility firm noted that it is interesting to watch how the impact of higher taxes under the Tax Reform for Acceleration and Inclusion (TRAIN) Act will impact on sales growth in the coming months.
“There is a risk that the impact of any inflation induced by higher taxes plus the impact of higher electricity prices arising from coal tax, VAT (value added tax) on transmission or the higher cost of SPUG (Small Power Utilities Group) which will translate to universal charges…these may have impact on the growth in demand for electricity. But our hope if there is a relative impact is on the Build, Build, Build program,” the Meralco executive asserted.
Reyes added that supply-wise, Luzon grid will be on the ‘safe side’ this year, unless there would be unwarranted simultaneous shutdowns or forced outages in power plants.
“We have installed capacity for summer demand, it’s a question of there being no confluence of scheduled and forced outages or any Malampaya shutdown,” he stressed.
The utility firm previously indicated that substantive growth in electricity demand had been coming from new builds for apartments and condominium units, the business process outsourcing (BPO) sector, the expanding Philippine Offshore Gaming Operators (POGO) as well as the retail trade of the country.
In the industrial segment, Meralco noted that “sales volumes sustained its growth momentum,” primarily anchored on the performance of the semiconductor, food and beverage as well as basic metal industries.
It added that the real estate sector also continues to grow rapidly, while retail trade remains “a strong pillar for commercial sales growth with contributions from tourism spurred by continuing airline promotions, budget fares from carriers and competitive hotel pricing.”
As of the last quarter, Meralco’s customer base expanded by 5.0 percent to about 6.3 million, with the biggest chunk of 92 percent still cornered by residential in the overall base of the utility firm’s customer accounts.
Residential sales had been logging growth of 5.0 percent; while commercial sector’s demand growth had been expanding 3.0 percent; and industrial rising by 4.0 percent.