Electricity rate slightly increases this July


MANILA, PHILIPPINES, 7TH July 2017 – After a record PhP1.43 per kWh reduction in June, Meralco announced a slight increase for July 2017, amounting to PhP0.0761 per kWh for a typical residential household , thereby bringing the overall rate from last month’s PhP8.17 per kWh to PhP8.25 per kWh. This month’s overall rate is comparable to the January 2010 level.  The slight rate increase this month amounts to a PhP15 increase in the total bill of a typical residential household consuming 200kWh.

The July rate reflects the refund of over-recovery on pass-through charges from January 2014 to December 2016 totaling around PhP6.9 billion. Meralco’s petition for refund with prayer for provisional authority on implementation was granted by the Energy Regulatory Commission (ERC) on May 11, 2017 for implementation from June to August 2017. The refund is not shown as a separate line item in the bill but is embedded in the different pass-through charges indicated in the bill, which include Generation, Transmission, and System Loss Charges and Lifeline and Senior Citizen Subsidies. For residential customers, the refund translates to a reduction of PhP0.79 per kWh, excluding taxes.

Higher generation cost due to higher IPPs and WESM charges

Overall generation charge increased this July by PhP0.0799 per kWh, from PhP3.8586 per kWh in June to PhP3.9385 per kWh for this month mainly due to higher IPPs and WESM charges.  

The cost of power sourced from the Independent Power Producers (IPPs) increased by P0.1751 per kWh due to peso depreciation and lower plant dispatch. Weakening of the peso against the US dollar caused the increase in peso conversion of dollar charges of IPP and PSA plants. Purchases from the Wholesale Electricity Spot Market (WESM) also increased by P0.4548 per kWh mainly due to billing adjustments, which include the additional compensation approved by the Philippine Electricity Market Corporation (PEMC) for the Must-Run Unit (MRU) operations of Malaya power plant from 2012 to 2015. In the WESM, power plants become MRU when instructed by NGCP to provide additional supply. The share of IPPs and WESM purchases to Meralco’s total requirements are 40.8% and 12.4%, respectively.

Despite the upward impact of peso depreciation, the cost of power from Power Supply Agreements (PSAs) decreased by P0.0176 per kWh due to lower coal prices and improved average plant dispatch. The share of PSAs this month stood at 46.8%.

Adjustments in other bill components

This month, there was a slight increase of PhP0.0042 per kWh in the transmission charge of residential customers, while taxes and other charges went down by a combined amount of around PhP0.0080 per kWh.

Meralco’s distribution, supply, and metering charges, meanwhile, have remained unchanged for 24 months, after the registered reductions in July 2015. Meralco reiterated that it does not earn from the pass-through charges, such as the generation and transmission charges. Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the National Grid Corporation of the Philippines (NGCP).

Meralco provides rainy season safety tips for customers

As the rainy season continues, Meralco advised its customers on important safety tips to prepare for floods or typhoons. Simple tips such as charging your cellphones, flashlights, and other important gadgets or rechargeable appliances. Staying updated with the news on TV and radio. Storing food and potable water. During the typhoon, Meralco advises customers to use rubber boots and gloves for added protection. In case of flood, switch off your circuit breaker. After the typhoon, help clean the debris in your area. If outlets or appliances are drenched, have a licensed electrician check these before using. For more helpful tips, customers may visit Meralco’s website at www.meralco.com.ph or its social media accounts, twitter @meralco and facebook at www.facebook.com/meralco.