Meralco power rates to decline in February

CUSTOMERS of Manila Electric Co. will see lower electricity bills in February. . — PHILIPPINE STAR/MIGUEL DE GUZMAN

By Angelica Y. Yang

TYPICAL HOUSEHOLDS in Metro Manila can expect their monthly electricity bills to fall by P14 in February, after Manila Electric Co. (Meralco) on Monday announced a cut in overall power rates due to lower generation charges.

In a statement, Meralco said the overall power rate stands at P8.6793 per kilowatt-hour (kWh) in February, P0.0704 per kWh lower than its January level. This is also P0.1830 per kWh less than the P8.8623 per kWh rate in February 2020.

Typical households are those that consume less than 200 kWh, according to the distribution utility.

This month, customers consuming 300 kWh, 400 kWh and 500 kWh would see a P21, P28 and P35 decrease in their monthly bills, respectively.

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The generation charge dipped by P0.0422 to P4.4152 per kWh in February, due to lower fixed charges from power supply agreements (PSAs), which make up 53.4% of Meralco’s energy requirements.

Meanwhile, the rates of independent power producers rose by P0.2013 per kWh due to lower average plant dispatch, higher prices from the Malampaya Deepwater Gas-to-Power project, and the depreciation of the peso against the dollar.

“Wholesale electricity spot market (WESM) rates also increased by P0.9577 per kWh due to higher average plant capacity on outage in the Luzon grid,” Meralco said in the statement.

Meralco Vice-President and head of utility economics Lawrence S. Fernandez told reporters at a briefing on Monday WESM charges rose because of more plant outages in January, compared with December.

He added that the cost of natural gas from the Malampaya plant had gone up as prices were revised to reflect higher global crude oil prices.

IPPs and WESM account for 39.5%, and 7.1% of Meralco’s power requirements, respectively.

Transmission charges dropped by P0.0128 per kWh due to lower ancillary services charges. Taxes and other charges were reduced by P0.0154 per kWh.

Meralco said the collection of the universal charge-environmental charge of P0.0025 per kWh is still suspended, as directed by the Energy Regulatory Commission (ERC).

The utility giant’s distribution, supply and metering charges have remained unchanged for 67 months since July 2015. It said it does not earn from pass-through charges, including generation and transmission charges.

“Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the NGCP. Taxes and other public policy charges like the universal charges and the FIT-All (feed-in tariff allowance) are remitted to the government,” Meralco said.

It said the February rate included the adjustments on over and under-recoveries for the period covering Jan 2017 to Dec 2019, as directed by the ERC. Residential customers can expect a net refund of about P0.1150 per kWh in their bills due to the adjustments, it said.

On Dec. 29, the ERC ordered Meralco to return P1.4 billion to its customers for over-collecting some charges during the billing periods covering January 2017 to December 2019. The ERC told Meralco to refund the over-recoveries over three months or until the amount was fully recovered.

In its order, the ERC also told the utility giant to recover its P2.38 billion of under-collections in its power generation charge during the same billing periods. The amortization period would go on for 24 months or until fully collected.

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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