THE Manila Electric Co. (Meralco) on Tuesday said it will increase electricity rates by P0.6427 per kilowatt-hour (kWh) this March, bringing the overall rate for a typical household to P13.8161 per kWh this month from P13.1734 per kWh in February.
The distribution utility said that for residential customers with a typical consumption of 200 kWh, this adjustment translates to an increase of around P129 in their total electricity bill.
Meralco said the increase was driven by the transmission charge, which went up by P0.2880 per kWh due to a 70 percent hike in ancillary service charges incurred by the National Grid Corp. of the Philippines (NGCP) from the Reserve Market. Costs from the Reserve Market accounted for almost half of the total transmission charge this billing month.
The generation charge also went up by P0.2209 per kWh because of the second extension of the power purchase agreement (PPA) with First Gas-Sta. Rita. Meralco said these increases offset a P1.0952 per kWh reduction in charges from the Wholesale Electricity Spot Market (WESM) during the period.
This month’s generation charge also included the P0.2817 per kWh contract price adjustment of ACEN Corp., Panay Energy Development Corp., South Premiere Power Corp. (SPPC) and Sual Power Inc. (SPI), as they were allowed by the Energy Regulatory Commission (ERC) to recover some of their costs due to changes in circumstance.
Meanwhile, other charges that include taxes registered a net increase of P0.1338 per kWh for the given period, and also reflected the implementation of the new uniform national lifeline subsidy rate of P0.01 per kWh in accordance with a recent ERC directive.
Pass-through charges for generation and transmission are paid to the power suppliers and the grid operator, respectively; while taxes, universal charges, and renewable energy subsidies are all remitted to the government.
Meralco’s distribution charge, on the other hand, has not moved since the P0.0360 per kWh reduction for a typical residential customer in August 2022.
Meralco clarified that these increases in both the transmission and generation charges did not reflect the current conflict in the Middle East and that its effects will be felt in the April billing period, depending on how the situation will develop.
On a related note, Meralco Executive Vice President Ronnie Aperocho also said in a statement that Meralco is actively implementing all necessary measures to shield customers from possible supply disruptions and upward pressure on electricity prices due to the effects of the Middle East conflict.
“We are closely coordinating with our power suppliers to keep generation at least-cost while prioritizing reliability across our system. We are also optimizing our energy mix and fully leveraging cost-efficient sources, regardless of technology. In addition, we are carefully managing our exposure to the WESM where price volatility is high. We also secure replacement power at the lowest cost, if needed,” Aperocho said.