Residential customers of Manila Electric Co. (Meralco) will see lower rates in their monthly bill for the second month in a row as charges for generation and transmission went down.
Meralco yesterday said in a statement overall charges for June were cut by 12.52 centavos per kilowatt-hour, which means that a typical residential customer using 200 kWh in a month will pay P25 less.
“The lower June rate is mainly due to a [15.56-centavo] per kWh decrease in generation and transmission charges, which more than offset a [7.33-centavo] per kWh increase in the Feed-In Tariff Allowance or FIT-All,” the company said.
FIT-All refers to a pass-through charge that is remitted to the state-run National Transmission Corp. (Transco) as an incentive for developers of renewable energy projects, such as those that operate wind, solar, biomass and run-of-river hydropower facilities.
The latest price adjustment brings Meralco’s overall charge to P9.8789 per kWh from P10.0041 per kWh in the May billing.
The generation charge alone went down by 6.95 centavos to P4.9828 per kWh from P5.0523 per kWh in May.
“The reduction is the result of a [44.2-centavo] per kWh decrease in the cost of power from power supply agreements (PSAs), mainly due to higher dispatch of Pagbilao Unit 1 and Ilijan Unit 1 as both returned to normal operations after undergoing scheduled maintenance,” Meralco said.
Meralco sourced 44 percent of its electricity supply through PSA suppliers.
On the other hand, prices at the wholesale electricity spot market (WESM) increased by 19.54 centavos per kWh while those from independent power producers (IPPs) went up by 22.66 centavos per kWh.
Meralco said charges at the WESM increased due to higher effective rates of line rentals, as electricity demand in the Luzon grid grew by about 239 MW.
“Higher IPP charges, on the other hand, were driven by the weakening of the peso against the US dollar,” the utility said. “Around 96 percent of IPP charges are dollar-denominated.”
Meralco sourced 15 percent of its supply from the WESM and 40 percent from IPPs.
Meralco also said transmission charges to residential consumers went down by 8.61 centavo per kWh, while taxes and other charges rose by 4.29 per kWh.
“Meralco’s distribution, supply, and metering charges, meanwhile, have remained unchanged for 35 months, after these registered reductions in July 2015,” the company said.