Meralco rolls back household rate by 19 centavos in September 2025

Customers of the Manila Electric Company (Meralco) should expect a sigh of relief this month as the power distributor is slashing its household power rate.

Meralco is reducing its rate by 19 centavos per kilowatt-hour (kWh) for the September billing period.

In particular, the company’s overall household electricity rate has gone down to P13.0851 per kWh, down by P0.1852 from P13.2703 per kWh in August.

This could translate to a reduction of P37.04 in this month's bill of a typical customer consuming 200 kWh.

“We hope that along with relatively lower consumption during this period, this rate cut will bring relief to our customers,” said Meralco vice president and head of Corporate Communications Joe Zaldarriaga.

Meralco attributed the rate reduction to lower generation charge which decreased by P0.2603 per kWh, on the back of lower costs of Independent Power Producers (IPPs) and Power Supply Agreements (PSAs), which went down by P1.3459 per kWh and P0.3660 per kWh, respectively.

The stronger peso against the US dollar was the main factor for the lower IPPs and PSA costs as the local currency’s appreciation affected around 99% of IPP costs and 57% of PSA costs that were dollar denominated.

The power distributor said the decreases were “more than enough” to offset the higher Wholesale Electricity Spot Market (WESM) charges and the start of collection of the contract price adjustment of Sual Power Inc. (SPI) and South Premiere Power Corporation (SPPC).

WESM charges rose by P0.3785 per kWh, as average demand in the Luzon grid and average capacity on outage increased by 182 MW and 132 MW, respectively.

Meralco added that the implementation of SPI and SPPC’s contract price adjustments follows the Supreme Court’s ruling that affirmed the right to invoke the “Change in Circumstance” clause of their supply agreements and allowed the generation companies to collect price adjustments to reflect additional fuel costs. 

“As a result, the Energy Regulatory Commission approved a total amount of P5.1 billion, to be collected over a period of six months, starting this September. This is around P0.26 per kWh for this month,” Meralco said.

PSAs, IPPs, and WESM accounted for 65%, 29%, and 6%, respectively, of Meralco’s total energy requirement for the period.

Moreover, transmission charge, another pass-through component of the electricity bill, went up by P0.1130 mainly due to higher ancillary service charges from the Reserve Market.

Other charges, including taxes, registered a net decrease of P0.0379 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 Feed-in Tariff Allowance are all remitted to the government, the power distributor said.

Meralco reiterated that its distribution charge has not been changed since the P0.0360 per kWh reduction for a typical residential customer beginning August 2022.

“Customers also continue to benefit from the ongoing implementation of the distribution-related true-up adjustment, equivalent to a reduction of P0.2024 per kWh for residential customers,” it said. —AOL, GMA Integrated News