Meralco power rates to increase in August due to generation charge hike

MANILA, Philippines — Customers of the Manila Electric Co. (Meralco), the country’s biggest power distributor, can expect their power bills to increase this month as the generation charge rose by 8.50 centavos per kilowatt-hour to 5.3721 per kWh.

This means that households consuming 100 kWh a month can expect an increase of P8.50 per kWh in their electricity bills, while those that use 200 kWh a month will have to pay P17 more for August. Households that use up 300 kWh monthly can also expect an increase of P25.50 per kWh.

In a statement, Meralco explained that the increase was primarily due to the higher cost of power taken from the wholesale electricity spot market (WESM) and the independent power producers (IPPs).

It reported that the effective cost of power purchased from the WESM increased by P1.2901 per kWh, to P9.7017 per kWh in July (used in August generation charge) from P8.4116 in June (used in July generation charge). There was an increase in “peak period purchases,” which were more expensive, to 62.1 percent, from only 38.4 percent in the previous month.

The cost of power supplied by the IPPs also went up by 16.65 centavos per kWh. This can be attributed to an increase in the cost of Malampaya natural gas by about nine percent. The reduction in the dispatch of (or in the generation of electricity by) Quezon Power Philippines Ltd. (QPPL) contributed to the higher electricity costs. The reduction was due to forced outages that curtailed the plant’s output, Meralco explained.