Meralco rates fall for the fifth consecutive month

Manila Electric Company (MERALCO) today announced another downward adjustment to electricity rates.

The general rate for a typical household decreased by P0.0623 per kWh, from P8.4911 per kWh last month to P8.4288 per kWh in September. This equates to a reduction of around P12 in the total bill for residential customers consuming 200 kWh.

This month’s overall rate is also the lowest in three years or since September 2017.

Due to the reduction in energy demand in its service area during the community quarantine period, MERALCO continued to invoke the Force Majeure provision in some of its Power Supply Contracts (PSA).

In September, the demand for force majeure amounted to about P463 million, which is equivalent to customer savings of P0.1710 per kWh in the generation charge. Without the Force Majeure claims, the generation charge and the total rate would have increased by 13 cents and 14 cents per kWh, respectively.

Over the past 6 months, force majeure claim savings totaled around P2.4 billion.

PSA charges decreased by P0.3032 per kWh due to MERALCO’s force majeure claim. PSA represented 54.8% of MERALCO’s energy requirement

Wholesale Electricity Spot Market (WESM) charges were P0.0147 per kWh lower this month due to decreased demand from Luzon, as some areas, including Metro Manila and adjacent provinces, returned to the Modified Enhanced Community Quarantine (MECQ) from August 4-18. WESM’s share of MERALCO’s supply needs was 11.6%.

Meanwhile, purchases from independent power producers (IPP) increased by P0.0601 per kWh mainly due to lower average dispatch from the plant. PPIs represented 33.6% of MERALCO’s total supply.

The transmission charge for residential customers registered a slight reduction of P0.0112 per kWh due to lower Charges for Ancillary Services. There was also a net decrease of P0.0130 per kWh in taxes and other charges.

The collection of the Universal Charge-Environmental Charge amounting to P0.0025 per kWh remains suspended, according to the instructions of the ERC.