The Power for People Coalition (P4P) on Wednesday congratulated Meralco on another year of extracting more from consumers as Meralco Chairman Manuel V. Pangilinan announced during the company’s Annual shareholders Meeting his expectation that 2023 will be a good year for the distribution utility.
The energy consumer advocates said that Meralco’s profitability this year comes as consumers suffer from the sharp rise in electricity prices, particularly from coal and gas power plants contracted by Meralco.
“It’s as if MVP is inviting a ‘you’re welcome’ from consumers. While Meralco pats itself on the back for booming profits, it keeps choosing to sell electricity from companies which force consumers to break our own backs trying to pay for increasingly costly electricity. The charges we pay this May for generation alone is Php 359 higher than the same month last year for a family consuming 200 kWh. When will Meralco’s good years also be good years for its customers?,” said Gerry Arances, convenor of P4P.
Rising electricity rates are exacerbated by San Miguel Corporation’s (SMC) pulling out of its contract to supply energy to Meralco at a fixed price after the Energy Regulatory Commission (ERC) denied the two companies’ petition for a price increase.
“Meralco, together with SMC, tried to get higher prices for its electricity but the ERC said no. After all the drama about least cost, they still get their way and increase prices by simply letting SMC walk on its power supply agreement without Meralco trying to penalize them. Of course, consumers had to pay for the difference, something that Meralco’s stockholders should remember as they pop their champagne bottles,” said Gerry Arances, P4P Convenor.
SMC’s Ilijan power plant is once again supplying electricity to Meralco under a new contract which passes on the full cost of fuel to consumers, contributing to fears of record-high electricity prices as generation companies continue to push fossil fuel sources such as gas, despite its high prices in the world market.
“Everyone’s a winner except consumers in the electricity sector. Meralco, despite SMC’s refusal to honor its fixed price contract with it, once again sources electricity from SMC through an emergency power supply agreement or EPSA. SMC, after breaking a previous contract, now gets to dictate the price at which it will sell electricity to consumers, and Meralco is going along with it. Under the fixed price contract, the Ilijan plant’s generation charge was at ₱3.3733 per kilowatthour in January 2019. With the EPSA, the same electricity cost consumers ₱8.5479 this month,” said Arances.
Meralco currently has five EPSAs covering the period from December 2022 until March 2024. Three of these contracts are with AboitizPower, while the remaining two are with SMC’s Southern Premiere Power Corporation, which owns the Ilijan plant.