Meralco hikes electricity rates for September
The Manila Electric Co. (Meralco), which had reduced power rates for the previous two months, is raising prices for the month of September as higher fuel expenses and a depreciating local currency have increased the cost of production.
According to a statement from Meralco, the general rate for a typical home increased this month to P9.9365/kWh from P9.5458/kWh in August by 39.07 centavos per kilowatt-hour (kWh).
The rate change results in an increase of around P78 in the monthly total charge for residential customers who use 200 kWh.
According to Meralco, rising fuel prices and a depreciating peso are to blame for rising generating charges.
According to the report, the generating charge for September increased by 35.81 centavos from P6.5812/kWh in August to P6.9393/kWh.
In the meanwhile, fees from Power Supply Agreements (PSAs) and Independent Power Producers (IPPs) increased by 80.26 centavos and 33.16 centavos per kWh, respectively, due to higher fuel costs and peso depreciation.
According to Meralco, the continued Malampaya gas supply constraint forced First Gas Sta to utilize more expensive alternative fuel. Rita and San Lorenzo will make sure there is a steady supply.
The business said that since 36% of PSA expenses and 98% of total IPP costs, respectively, are priced in dollars, peso devaluation likewise increased IPP and PSA charges.
The PSA rate hike, it stated, was partly influenced by the ongoing increase in coal costs internationally.
Meralco stated that lower charges from the Wholesale Electricity Spot Market (WESM), which showed a drop of P3.7473/kWh as the supply situation in the Luzon grid improved, partially offset increased PSA and IPP expenses.
There was no Yellow Alert in August due to the drop in average daily peak demand, and the frequency of secondary price limit implementation decreased from 27.62% in July to 4.7%.
The PSAs, IPPs, and WESM supplied 48%, 42%, and 10% of Meralco’s energy needs for the time period, respectively.
On the other hand, decreasing Ancillary Service fees caused the transmission tariff for residential users to drop by 43 centavos per kWh.
Taxes and other fees saw a net rise of 7.58 centavos per kWh as well, with the recent Energy Regulatory Commission ruling adding 2.39 centavos per kWh to the Universal Charge for Missionary Electrification (UCME) (ERC).
With this change, universal prices have increased from 19.89 centavos per kWh to 22.28 centavos per kWh, according to Meralco.
The business also stated that taxes, universal charges, and Feed-in Tariff Allowance (FIT-All) are all paid to the government, while pass-through charges from production and transmission are paid to the power providers and the system operator, respectively.
Meralco said that its only sources of income are distribution, supply, and metering fees, which for the average residential customer decreased by 3.60 centavos per kWh in August.
Prior to this shift, the business claimed that distribution charges had not altered since the July 2015 cut.
