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Meralco rates up in May

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Linemen are seen working in Manila, April 25, 2024. — PHILIPPINE STAR/RYAN BALDEMOR

By Sheldeen Joy Talavera, Reporter

RESIDENTIAL CUSTOMERS in areas served by Manila Electric Co. (Meralco) will see higher electricity bills this month due to the increase in generation charge.

In a statement on Tuesday, Meralco said that the overall rate will climb by P0.4621 per kilowatt-hour (kWh) to P11.4139 per kWh in May from P10.9518 per kWh in April.

Households consuming 200 kWh will see their monthly bills increase by around P92.

Meanwhile, those consuming 300 kWh, 400 kWh, and 500 kWh will see their monthly electricity bills go up by P139, P185, and P231, respectively.

“Driving this month’s overall rate increase was the generation charge which went up by P0.4455 per kWh primarily due to higher costs from the Wholesale Electricity Spot Market (WESM) and power supply agreements (PSAs),” the power distributor said.

Charges from the WESM rose by P1.7913 per kWh due to the “tight supply condition in the Luzon grid during the April supply month as demand went up by 2,401 MW (megawatts).”

“There were three days with yellow alert and five days with yellow/red alerts from normal conditions the previous supply month. In addition, the secondary price cap was triggered 19% of the time in April versus only 7% the previous month,” the company said.

Meralco Vice-President and Head of Corporate Communications Joe R. Zaldarriaga said at a briefing that the company had to resort to the spot market as the supply situation last month was “challenged.”

“As you know, the supply situation in April was challenged, not only on our side but the entire grid. So, if we did not resort to the spot market, we would have had a shortage in our energy supply,” he said in mixed English and Filipino.

According to the National Grid Corp. of the Philippines, the Luzon grid was placed under red alert for five days and yellow alert for 11 days in April.

The Visayas grid was on red alert for five days, and on yellow alert for 10 days. On the other hand, the Mindanao grid was on yellow alert for two days.

Charges from PSAs went up by P0.2871 per kWh “due to lower excess energy deliveries of some PSAs, which were priced at discount.”

The increase was also attributed to the charges from an emergency PSA that covered Meralco’s supply requirements while awaiting regulatory approval of PSAs that underwent competitive selection processes.

Peso depreciation, which affected 14% of PSA costs that were dollar-denominated, also contributed to the increase, the company said.

On the other hand, charges from independent power producers (IPPs) fell by P0.6942 per kWh due to higher average IPP dispatch and lower fuel prices.

Meralco said that the IPP rate reflected the withholding of charges from First Gas in accordance with the Energy Regulatory Commission order.

WESM, PSAs, and IPPs accounted for 30%, 36%, and 34% respectively of Meralco’s total energy requirement for May.

The transmission charge, taxes, and other charges increased by P0.0166 per kWh in May.

“Pass-through charges for generation and transmission are paid by Meralco to the power suppliers and the grid operator, respectively, while taxes, universal charges, and the Feed-in Tariff Allowance (FIT-All) are all remitted to the government,” the company said.

Distribution charge has been unchanged at P0.0360 per kWh since August 2022.

Meanwhile, Meralco said that incidents of power interruptions due to kite-flying increased to 40 between January and March compared with last year’s 26.

“We are appealing to our customers to refrain from flying kites and picking fruits near power lines since these can cause power interruptions and accidents,” Mr. Zaldarriaga said.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls.

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