Metro Manila (CNN Philippines, August 8) — Meralco announced on Monday a reduction in its rates for the second straight month in August.
In a statement, Meralco said its rates went down ₱0.2087 to ₱9.5458 per kilowatt-hour for the current month.
This means that a reduction of around ₱42 in the total bill of a residential household consuming 200 kWh may be expected.
“With this adjustment, Meralco’s rates now have a combined reduction of ₱0.9154 per kWh over the past two months and a net decrease ₱0.2315 per kWh since the start of the year,” the company said.
Meralco attributed the decline to the generation charge for the period, which went down by ₱0.1944 to ₱6.5812 per kWh due to reduced Power Supply Agreements (PSAs) charges by ₱0.4273 as this month’s rate no longer included recovery of deferred generation costs for the April bill.
“Higher excess energy of some PSAs, which are priced at discount, also contributed to the decrease,” Meralco added.
This reduction more than offset the increased charges from Independent Power Producers (IPPs) and the Wholesale Electricity Spot Market (WESM), Meralco said.
IPP charges increased by ₱0.4213 per kWh driven by the continued rise in international fuel prices, which was reflected by the 15% increase in the Malampaya natural gas price starting this quarter.
“Power suppliers that have pass-through adjustments in Malampaya fuel namely, First Gas-Sta. Rita, First Gas-San Lorenzo, and First Natgas-San Gabriel accounted for 44% of Meralco’s supply during the period. Reduced use of more expensive alternative fuel by First Gas plants mitigated further increase in IPP charges,” Meralco added.
WESM charges also added ₱0.0433 per kWh due to tight supply conditions in the Luzon grid, which was placed on Yellow Alert on July 5 due to insufficient operating reserves following the forced outage of several large power plants. Persistently high spot market prices triggered the imposition of the secondary price cap almost 27% of the time, the company said.
PSAs, IPPs, and WESM accounted for 52%, 43%, and 5%, respectively, of Meralco’s energy requirement for the period.
The company said distribution-related refunds amounting to ₱48.3 billion ordered by the Energy Regulatory Commission (ERC) is also ongoing to help customers with their monthly bills. This is equivalent to a total refund rate of ₱1.8009 per kWh for residential customers.
Also contributing to the decline is Meralco’s reduced distribution charge by ₱0.0360 per kWh. This is in line with the June 16 decision of the ERC on the company’s final Interim Average Rate.
Prior to this adjustment, distribution charges were unchanged since the reduction in July 2015.
Meanwhile, transmission charge for residential customers climbed ₱0.0235 per kWh, while taxes and other charges declined ₱0.0018 per kWh.
