May 2024 Rates Updates
Following a significant reduction of almost one peso last month, the Manila Electric Company (Meralco) today announced an increase of P0.4621 per kWh in the May electricity rate, bringing the overall rate for a typical household to P11.4139 per kWh from P10.9518 per kWh in April.
For residential customers consuming 200 kWh, the adjustment is equivalent to an increase of around P92 in their total electricity bill.
Higher generation charge pulls up overall electricity rate
Driving this month’s overall rate increase was the generation charge which went up by P0.4455 per kWh primarily due to higher costs from the Wholesale Electricity Spot Market (WESM) and Power Supply Agreements (PSAs).
Charges from WESM went up by P1.7913 per kWh due to the tight supply condition in the Luzon grid during the April supply month as demand went up by 2,401 MW. There were three (3) days with Yellow Alert and five (5) days with Yellow/Red Alerts from normal conditions the previous supply month. In addition, the secondary price cap was triggered 19% of the time in April versus only 7% the previous month.
Similarly, charges from PSAs increased by P0.2871 per kWh due to lower excess energy deliveries of some PSAs, which were priced at a discount, and charges from an emergency PSA that covered Meralco’s supply requirements while awaiting regulatory approval of PSAs that underwent a series of Competitive Selection Process (CSPs). Peso depreciation, which affected 14% of PSA costs that were dollar-denominated, also contributed to the increase.
Tempering the increase in the generation charge was the P0.6942 per kWh reduction in charges from Independent Power Producers (IPPs) due to higher average IPP dispatch and lower fuel prices. This month’s IPP rate reflected the withholding of charges from First Gas, including the incremental Malampaya gas costs for First Gas-Sta. Rita under its new Gas Sale and Purchase Agreement (GSPA) and costs related to the use of Liquefied Natural Gas (LNG), other than the landed cost of LNG, in accordance with an order from the Energy Regulatory Commission.
WESM, PSAs, and IPPs accounted for 30%, 36%, and 34% respectively of Meralco’s total energy requirement for this period.
Transmission and other charges
The transmission charge, taxes, and other charges also registered a net increase of P0.0166 per kWh.
Pass-through charges for generation and transmission are paid by Meralco to the power suppliers and the grid operator, respectively, while taxes, universal charges, and the Feed-In Tariff Allowance or FIT-All are all remitted to the government.
Meralco’s distribution charge, on the other hand, remained unchanged since the P0.0360 per kWh reduction for a typical residential customer beginning August 2022.
Meralco reminds public to avoid flying kites, picking fruits near power lines
To help avoid power interruptions and accidents such as electrocution, Meralco reminded the public anew to steer clear of power lines when flying kites or picking fruits from trees.
Incidents of power interruptions due to kite-flying significantly increased to 40 from 26 between January and March this year compared to the same period in 2023.
“We are appealing to our customers to refrain from flying kites and picking fruits near power lines since these can cause power interruptions and accidents,” Meralco Vice President and Head of Corporate Communications Joe R. Zaldarriaga said.
Should kites get tangled or stuck in power lines, Zaldarriaga asked the public to report these incidents to Meralco instead of trying to retrieve the items themselves.
Customers can report power outages and other concerns through Meralco’s official social media accounts on Facebook (www.facebook.com/meralco) and X formerly Twitter (@meralco). They may also text their concerns to 0920-9716211 or 0917-5516211 or contact the Meralco Hotline at (02) 16211.