Meralco sees cheaper power rates in January

Manila Electric Co. (Meralco) | INQUIRER FILES

After two straight months of rate hikes, Manila Electric Co. (Meralco) said Thursday its customers can expect lower electricity bills this January.

Meralco vice president and head of Corporate Communications Joe Zaldarriaga said the group was seeing a potential downward adjustment in the generation charge for this month, which may lower the overall rates. The generation charge usually accounts for at least half of power bills.

Meralco is set to release the official rates next week.

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For late last year, particularly in November and December, the power distributor giant said the more costly rates could be blamed on higher generation charge, which goes to its suppliers.

The generation charge covers the cost of power purchased from independent power producers, the Wholesale Electricity Spot Market (WESM), and power supply agreements.

“This will be primarily driven by lower WESM prices due to improved supply situation in the Luzon Grid as both average peak demand and average capacity on outage went down in the December supply month.”

In a separate statement, the Independent Electricity Market Operator of the Philippines (IEMOP) confirmed that last month’s spot power prices dropped by 21.9 percent to P3.45 per kilowatt-hour (kWh) from the previous P4.42 per kWh.

The billing period covered November 26 to December 25, the WESM operator said.

During the period, the demand nationwide decreased by 2.8 percent to 13,275 megawatts (MW) from 13,659 MW a month ago.

Supply, meanwhile, went up by 3.4 percent to 20,150 MW from the previous 19,492 MW.

All main islands witnessed lower WESM prices, with Luzon posting the largest cut of 23 percent to P3.26 per kWh. Its demand likewise dipped to 9,344 MW, while supply inched up to 14,193 MW.

Visayas also booked lower prices at P3.87 per kWh from P4.82 a month ago. Its demand reached 1,942 MW, just 1.4 percent down from November. Its supply increased by 3.8 percent to 2,485 MW.

Mindanao, on the other hand, saw prices hit P3.88 per kWh, down 20 percent from P4.85 per kWh. Its demand fell by 2 percent to 1,989 MW, while supply ended almost flat at 3,473 MW.