What's Happening?

Meralco rates up this month

by Joyce Remo

PUBLISHED ON January 10, 2023

MERALCO customers should get ready for higher electricity bills this month.

Meralco announced on Tuesday an increase in electric power rates by P0.6232 per kilowatt hour for January. This brings the overall rate of an average household to P10.9001 per kWh from last month’s P10.2769 per kWh.

Due to this, residential households that consume at least 200 kWp per month will experience a P125 increase in their electricity bill.

Reasons for hike

The power rate hike is due to the increase in generation charge by 33 centavos, or to P7.1291 from P6.7975 per kWh in December.

Another factor that contributed to the increase is the completion of a distribution-related refund equivalent to P0.2761 per kWh for residential customers.

But Meraclo said two on-going refunds amounting to P1.0579 per kWh for residential customers continue to temper their monthly bills.

These refunds would be completed by January and May 2023 and their impact felt in the succeeding months, or February and June 2023.

Independent charges

Meralco also said charges from Independent Power Producers rose due to an increased use of more expensive alternative fuel by First Gas Sta. Rita and San Lorenzo. This came amid insufficient supply from Malampaya.

IPPs dispensed 46 percent of Meralco’s energy requirement for the December supply month.

Another factor that triggered the rate increase is the swelling of charges from the Wholesale Electricity Spot Market (WESM), amounting to a P0.6808 per kWh increase due to tight supply conditions.

Meralco said it had to partially source replacement power from WESM due to the suspension of the Power Supply Agreement (PSA) with South Premiere Power Corporation (SPPC) starting December 7, 2022.

PSA charges, on the other hand, went down by P0.2710 per kWh because of the higher share of excess energy deliveries that are priced at a discount. PSA provides 45 percent of Meralco’s total energy requirement for the period.

Meanwhile, Meralco’s distribution charge remained at P0.0360 per kWh reduction for a typical residential customer from August 2022.

Other charges

Meralco said transmission charges for residential customers decreased by P0.0314 per kWh due to lower Ancillary Service charges.

On the other hand, taxes and other charges increased by P0.0469 per kWh.

At the same time, the collection of the Feed-In Tariff Allowance (FIT-All) remains suspended due to the order of the Energy Regulatory Commission suspending the collection of P0.0364 per kWh FIT-All rate from December 2022 to February 2023.

Pass-through charges for generation and transmission are paid to the power suppliers and the grid operator, respectively, while taxes, universal charges, and FIT-All are all remitted to the government, said Meralco.

Energy savers

Meralco advised the public to continue practicing energy saving techniques and observe electrical safety to lessen the repercussions from the power rate increase.

The electricity provider shared a few power saving tips to effectively manage monthly electric bills: