Electricity rates rise for 4 months in a row
Customers of the Manila Electric Co. (Meralco) will pay an additional 23.53 centavos per kilowatt-hour in July as Meralco increased its overall rate for the fourth straight month, bringing the total to 58.85 centavos per kWh.
The latest hike, which was attributed mainly to “persistently high charges” at the Wholesale Electricity Spot Market (WESM), means an additional expense of P47 for a typical residential customer of Meralco, who consumes 200 kWh of electricity a month.
For the July billing period, Meralco’s overall rate increased to P8.9071 per kWh from P8.6718 per kWh in June.
The generation charge alone increased by 25.36 centavos to P4.8707 per kWh from P4.6171 per kWh in June.
“WESM charges remained high at P8.7424 per kWh due to tight supply conditions in the Luzon grid, aggravated by the ongoing Malampaya natural gas supply restriction,” said Joe Zaldarriaga, spokesperson for Meralco.
Zaldarriaga said that in June, rising demand amid the unplanned shutdown of several power plants jacked up WESM prices to “persistently high [levels] for extended periods.”
According to the Independent Electricity Market Operator of the Philippines, which runs the WESM, the effective spot settlement price (ESSP) averaged at P7.25 per kWh in the May 22 to June 21 trading period.
A month earlier, April 22 to May 21, the average ESSP was pegged at P8.31 per kWh. This was less than two weeks before rotational brownouts occurred on May 31 and June 1.
Before that, from March 22 to April 21, the average ESSP was pegged at P4.04 per kWh.
For the July cycle, purchases from the spot market account for 8 percent of Meralco’s supply.
Also, the cost of Meralco supply sourced through contracts signed before 2000— with independent power producers or IPPs—increased by 19.29 centavos per kWh.
On the other hand, the cost of electricity sourced through newer contracts—power supply agreements or PSAs—decreased by 5.21 per kWh.
For July, IPPs represent 40 percent of Meralco supply while PSAs account for 53 percent.
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