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Meralco lowers rates anew in February
By TED CORDERO,GMA NewsCustomers of the Manila Electric Company (Meralco) should expect lower bills this month as the power distributor reduced household electricity rates anew for February.
On Tuesday, Meralco announced a reduction of P0.1185 per kilowatt-hour (kWh), bringing the overall rate for February to P9.5842/kWh from January’s P9.7027/kWh.
The downward adjustment translates to a P24 reduction in the monthly bill of residential customers consuming 200 kWh.
The lower February rate comes as generation charges for the month fell by P0.2305/kWh to P5.1957/kWh from P5.4262 last month, due to lower charges from Independent Power Producers (IPPs) and the Wholesale Electricity Spot Market (WESM), which more than offset an increase in the rate from Power Supply Agreements (PSAs).
Meralco said charges from IPPs went down by P0.3395 per kWh due to higher plant dispatch of Quezon Power and First Gas - Sta. Rita.
Quezon Power resumed normal operations in the January supply month after experiencing some outages and deration in December, while First Gas – Sta. Rita’s output increased following the completion of the scheduled maintenance outage of Module 10 in December, it said.
The IPP charges also reflected a reimbursement from Shell Philippines Exploration B.V. (SPEX) to First Gas covering a portion of incremental fuel cost incurred in relation to the use of liquid fuel during unplanned Malampaya gas supply restrictions, the power distributor said.
“These were able to more than offset the increase in Malampaya natural gas prices resulting from its quarterly repricing, and an increase in coal prices,” Meralco said.
Likewise, WESM charges decreased by 3.1277/kWh due to the significant reduction in Meralco’s WESM purchases, which mitigated the impact of higher spot market prices during the January supply month.
Despite lower demand because of cooler weather, Meralco said the Luzon grid was placed on Yellow Alert on January 10 and 11 due to forced plant outages.
The tight supply condition led to sustained high WESM prices, which triggered the imposition of the secondary price cap 28.37% of the time.
The PSA rate, meanwhile, increased by P0.1631/kWh, owing to lower demand that led to lower excess energy deliveries, which are priced at a discount, from AC Energy, San Miguel Energy Corp. (Sual), and South Premiere Power Corp. (Ilijan).
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IPPs, PSAs, and WESM provided 52.2%, 47.4%, and 0.4% of Meralco’s energy requirement, respectively.
Other charges
Transmission charge for residential customers, meanwhile, increased by P0.0454/kWh due to higher Ancillary Service and Power Delivery Service charges.
Taxes and other charges also registered a net increase of P0.0666/kWh mainly resulting from the resumption of local franchise tax (LFT) recovery, in accordance with Energy Regulatory Commission (ERC) rules, and higher effective value-added tax (VAT) rates this month.
Collection of the Universal Charge-Environmental Charge amounting to P0.0025/ kWh remains suspended as directed by the Energy Regulatory Commission (ERC).
Meralco said its distribution, supply, and metering charges have remained unchanged for 79 months, after registering a reduction back in July 2015.
The power distributor reiterated that it does not earn from the pass-through charges, such as the generation and transmission charges, as 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 Feed-in Tariff Allowance are remitted to the government, it said.
Meralco noted that its continued implementation of the Distribution Rate True-Up refund which began in March 2021 continued to temper upward movements of rates.
The refund rate for residential customers is at P0.2761/kWh and appears in customer bills as a line item called “Dist True-Up.”
The ERC provisionally approved Meralco’s proposal to refund around P13.9 billion over a period of 24 months or until the amount is fully refunded.
The amount represented the difference between the Actual Weighted Average Tariff and the ERC-approved Interim Average Rate for distribution-related charges for the period July 2015 to November 2020, according to Meralco. —KBK, GMA News