Lower power rates this month but higher charges for renewable energy

IT seems like the Filipino consumer is being bombarded with bad news left and right this whole year. We are well aware of the impact of the TRAIN Law, as taxes on just about everything and anything under the sun are being subjected to an increase, and we poor consumers are forced to carry that burden.

And just recently, we found out that the country’s inflation rate has shot up to 4.6 percent, the highest in six years, and this is alarming because this is far above the government’s target rate.

Just for reference, for the year 2018, the Bangko Sentral ng Pilipinas set an inflation target of between two and four percent. This tells us that the purchasing power of the Philippine peso is getting weaker, and again, it is we, the average everyday Filipino consumer who has to take the brunt of higher prices and less purchasing power.

Not to mention, the pain of paying monthly bills for everything ranging from water to phone bills. On top of all that, you have the rising prices in oil and gas. But there is one bright spot amidst all these price increases -- electricity rates

We were actually presented with good news for June, by the country’s largest distribution utility Meralco.

Meralco announced a second consecutive month of rate decrease for the month of June. When you get your electricity bills this month, expect the rate to be lower by almost P0.13 per kilowatt hour.

As explained in the primetime news that I was able to catch Thursday last week, Meralco spokesman Joe Zaldarriaga said this rate decrease means savings for Meralco customers with, say, a 200-kwh consumption, of around P25 in their total electricity bills.

In fact, if you total the savings from the past two months, customers have enjoyed more than P130 of savings in their total bills. This can go a long way, especially if you’ve also been practicing energy efficiency this past summer season. Any kind of saving is much welcome especially during the back-to-school-activities for your kids, like buying books and notebooks, baon for them, and, of course, paying for the tuition fees. Any rate decrease will bring a big smile to your face.

Now, usually when there is a rate decrease, especially in our electricity bills, we don’t pay too much attention to why the decrease happened in the first place. But sometimes, it is good to know what makes up our bill.

Knowledge, after all, is power. So count yourselves blessed as it appears that most components of our electricity bills went down this month. From what I gather, it looks like generation charge, transmission charge, taxes, and most other charges went down.

This means that payment to power plants decreased, as well as payment to NGCP, or the National Grid Corporation of the Philippines, which manages the transmission wires. Hopefully all members of the energy sector can keep this encouraging and delightful trend up for the coming months.

But while the rate decrease of P0.13 per kilowatt hour is definitely good news for us, consumers, the sad part is that it could have actually been higher. Yes, you read me right. The rate decrease for this month’s electricity could have actually been more than P0.20 centavos per kilowatt hour, if not for the increase in what is called the Feed-in Tariff Allowance.

And this was no small increase, as it was reported to be more than P0.7 per kilowatt hour. Overall, this means that every month, we are paying almost P0.26 per kilowatt hour for this FiT-All rate, a price certainly too high for something that I just don’t feel the benefit of paying for.

Now, honestly, I am not too certain that Filipinos are aware or informed about this Fit-All rate.

Apparently, this FiT-All is a cost that goes to renewable energy suppliers as an incentive for operating wind, solar, biomass and hydro plants, as if they needed more incentive other than pursuing a cleaner, greener Philippines.

Now, while renewable energy is a noble cause, and I do think that it has its place in our energy mix, my question is why is the FiT-All rate so high? And why is it increasing every year? I’ve done my research, and I’ve learned that the Philippines is such a small contributor to the total carbon emissions in the world. In fact, most of our pollution comes from traffic and congestion.

It’s a bit strange to me then that most of our paying money for electricity goes to renewable energy when there can be so many different, more relevant uses for it. We, as consumers, are not even sure that the FiT-All rate that we are paying is actually being used for energy that we are receiving, using, and enjoying.

For example, every month, we are paying FiT-All that goes to these so-called renewable energy suppliers. But what assurance is there that the renewable power that we are buying actually goes to us? There really isn’t any assurance at all. At the end of the day, I just want to know that the power I am paying for with the FiT-All rate somehow goes to me. That is my challenge to renewable energy suppliers. Otherwise, their operations strike me as borderline sketchy.