MANILA Electric Co. (Meralco) announced Tuesday that rates will increase this month by P0.2226 per kilowatt-hour due to higher transmission and universal charges.
The adjustment brings the overall household rate to P13.1734 per kWh from P12.9508 per kWh in January. For residential customers consuming 200 kWh, Meralco said this translates to an increase of about P45 in their total bill.
The transmission charge for residential customers rose by P0.1975 per kWh. Meralco attributed this to higher power delivery service charges and a significant jump in ancillary service charges from the Reserve Market incurred by the National Grid Corp. of the Philippines.
An increase of P0.0770 per kWh in the Universal Charge for Missionary Electrification (UCME) also drove the upward adjustment. This followed the Energy Regulatory Commission’s (ERC) approval of a new rate of P0.2763 per kWh, up from P0.1993 per kWh, implemented at the start of the February billing cycle. The UCME is collected from all on-grid end-users to subsidize electricity costs in remote areas. Other charges, including taxes, saw a net increase of P0.0554 per kWh.
The generation charge decreased by P0.1073 per kWh, settling at P7.1206 per kWh (down from P7.2279 per kWh). This decline, primarily driven by lower costs from independent power producers (IPPs), helped offset the spikes in transmission and other components. Charges from IPPs dropped by P0.8108 per kWh, largely due to lower fixed fees from First Gas-Sta. Rita following the completion of fee collections, and a reduction in Malampaya natural gas prices resulting from quarterly repricing.
These reductions offset a P1.5682 per kWh surge in Wholesale Electricity Spot Market (WESM) charges and a P0.0483 per kWh increase in Power Supply Agreement (PSA) costs. WESM prices rose due to tighter supply conditions in the Luzon grid, where average capacity on outage increased by approximately 973 megawatts. Meanwhile, PSA charges were pushed up by lower dispatch following planned maintenance shutdowns at Excellent Energy Resources Inc. and South Premiere Power Corp. Meralco noted these shutdowns were conducted in preparation for the upcoming dry season in April.
For the period, PSAs accounted for 66 percent of Meralco’s energy requirement, followed by IPPs at 24 percent and WESM at 10 percent. Meralco’s distribution charge remains unchanged since a P0.0360 per kWh reduction in August 2022. The utility clarified that pass-through charges for generation and transmission are paid to suppliers and the grid operator, while taxes, universal charges, and renewable energy subsidies are remitted to the government.
