THE Manila Electric Company (Meralco) announced on Thursday a decrease in electricity rates for January as a result of lower generation charge from its suppliers.
A typical household consuming 200 kilowatt-hours (kWh) will pay P0.2703 less per kWh, bringing the total rate to P8.09 per kWh.
The rate is lower by P0.31 per kWh compared with P8.40 per kWh in January 2016, according to Meralco.
This translates to a P54 decline in the electricity bill of a household with a monthly consumption of 200 kWh.
Lower capacity charges
“This January, there was a decrease in the generation charge, which is P0.2351 per kWh lower than last month’s P3.9351 per kWh,” the company said.
“At P3.70 per kWh, the generation charge is P0.22 per kWh lower compared to January 2016’s P3.92 per kWh. This is also the lowest generation charge since October 2004,” it added.
The decrease is a result of P0.59 per kWh drop in the cost of power under by Power Supply Agreements (PSA), mainly due to lower capacity charges of the Pagbilao and Ilijan power plants.
“This reduction in capacity fees is due to the annual reconciliation of outage allowances that is done at the end of each year under the contracts approved by the Energy Regulatory Commission (ERC),” Meralco noted.
“The capacity fees from these suppliers will normalize in the following month. The share of PSAs stood at 39.7 percent,” it said.
The cost of power from the Independent Power Producers (IPPs) showed a slight decrease of P0.0005 per kWh.
Improved power dispatch from the First Gas-Sta. Rita plant made up for the effects of the lower dispatch levels from the Quezon Power and First Gas-San Lorenzo. The share of IPPs to Meralco’s total requirements for December 2016 was 38.4 percent.
Overall charges from the Wholesale Electricity Spot Market (WESM) had a very minimal adjustment of P0.0267 per kWh, or from P2.5398 to P2.5665 per kWh, according to Meralco. The share of WESM purchases to Meralco’s total requirements went down to 21.8 percent from 22.5 percent.
There was a slight increase in the transmission charge of residential customers by P0.0042 per kWh this month, but was offset by a combined decrease of P0.0394 per kWh in taxes and other charges.
Meralco’s distribution, supply and metering charges remained unchanged for 18 months since registering declines July 2015, Meralco noted.
The company reiterated it does not earn from the pass-through charges, such as the generation and transmission charges. The generation charge goes to the power suppliers, while the transmission charge goes to the National Grid Corporation of the Philippines.