Meralco hikes rate this month

October 08, 2019

FOLLOWING five straight months of reductions, the Manila Electric Company (Meralco) yesterday announced a power rate increase of P0.0448 per kilowatt hour (kWH) this October.

In a statement, Meralco said the  overall electricity rates for a typical household consuming 200kWh will be increased to P9.0862 per kWh this October from last month’s P9.0414 per kWh.

The adjustment of P0.0448 per kWh will mean an increase of at least P9 in the typical household’s total bill.

Even with the slight increase this month, following five straight months of decrease, there has been a total downward adjustment of electricity rates amounting to almost P1.47 per kWh since April 2019.

From P4.5191 per kWh last month, the generation charge for October inched up to P4.5406 per kWh, a slight increase of P0.0215 per kWh.

The increase is due to a smaller Net Settlement Surplus (NSS) refund for October from the Wholesale Electricity Spot Market (WESM).  WESM charges decreased by P0.5290 per kWh driven by an improved power supply situation in the Luzon grid as there were fewer power plants on outage during the supply month.

The WESM charges this month also included the second installment of the NSS refund, as directed by the Energy Regulatory Commission (ERC) in an Order dated August 1, 2019. 

The power rate reduction last September was partially due to an NSS refund of approximately P684 million. 

For this month, the NSS refund is smaller at around P381 million. Meralco reiterated that it does not earn from the pass-through charges, such as the generation and transmission charges.

Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the NGCP. Taxes and other public policy charges like the FIT-All rate are remitted to the government.