Hike in gen charge spikes power bills

The Manila Electric Co. (Meralco) has raised its generation charge by 8.50 centavos per kilowatt-hour to P5.3721 per kWh, signaling a corresponding increase in power bills.

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

Meralco said that it jacked up its generation charge primarily because of the higher cost of power sourced from the wholesale electricity spot market (WESM) and the independent power producers (IPPs).

It reported that the effective cost of power purchased from WESM increased by P1.2901 per kWh to P9.7017 per kWh in July (which is used in computing the August generation charge) from P8.4116 per kWh 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, it said.

The cost of power supplied by the IPPs also went up by 16.65 centavos per kWh, due partly to the 9-percent increase in the cost of Malampaya natural gas.

The reduction in the generation of electricity by Quezon Power Philippines Ltd. (QPPL) contributed to the higher power costs, Meralco added. The reduction was due to forced outages that curtailed the plant’s output, it explained.

Still, Meralco said, the IPPs were the company’s cheapest source of electricity.