Meralco hikes rates for 3 straight months | Inquirer News

Meralco hikes rates for 3 straight months


POWER QUEUE Customers line up at the Meralco business center along Commonwealth Avenue in Quezon City to settle their electricity bills. —GRIG C. MONTEGRANDE

MANILA, Philippines — The overall rates of Manila Electric Co. (Meralco) increased for three months in a row, the latest by 7.98 centavos per kilowatt-hour in the May bill mainly due to higher prices at the spot market.

This means an additional expense of P16 for a typical residential customer of Meralco, which is billed for 200 kWh.


Since April, the increases in Meralco rates have accumulated to a total of 35.32 centavos per kWh. In the June billing alone, Meralco’s overall rate increased to P8.6718 per kWh from P8.592 per kWh in May.

For June, the generation charge increased by 6.98 centavos to P4.6171 per kWh from P4.5474 per kWh in April.


Tight supply

Because of tight supply conditions in the Luzon grid, charges at the Wholesale Electricity Spot Market (WESM) increased by P1.6322 per kWh.

Demand for electricity in Luzon rose by 1,131 megawatts to 11,556 MW in May from 10,425 MW amid hotter temperatures and increased economic activities.

The supply-and-demand situation worsened, prompting the National Grid Corporation of the Philippines to raise the red alert in Luzon for three consecutive days earlier this month. Rotational brownouts were experienced across the island, including parts of the Meralco franchise areas.

Still, Meralco said the increase in WESM charges was tempered by lower charges from contracted suppliers. This was attributed to the greater dispatch of power plants and also the appreciation of the peso against foreign currencies.

The cost of supply sourced through contracts signed before 2000—with independent power producers or IPPs—decreased by 0.37 centavo per kWh.

Higher transmission charge

For June, Meralco is getting 52 percent of its supplies through power supply agreements and 42 percent from IPPs. The share of electricity bought on the spot declined to 6 percent of Meralco’s total supply.

Meanwhile, there was an increase of 1.01 centavos per kWh in the transmission charge, taxes and other charges for residential customers.


According to Meralco, the latest monthly increase was tempered by the continued implementation of a distribution rate refund ordered by the Energy Regulatory Commission (ERC).

The ERC provisionally approved Meralco’s proposal to refund about P13.9 billion over a period of 24 months or until the amount is fully refunded. INQ

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TAGS: Luzon grid, MERALCO, National Grid Corp. of the Philippines (NGCP), power rate hike, Wholesale Electricity Spot Market (WESM)
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