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Meralco power rates to rise in June

PHILIPPINE STAR/ RUSSELL PALMA

RESIDENTIAL customers in areas served by Manila Electric Co. (Meralco) can expect electricity rates this month to rise, with typical households consuming 200 kilowatt-hours (kWh) getting billed higher by nearly P80 or P10.4612 from P10.0630 per kWh previously.

In a press release on Friday, the listed distribution utility said the overall power rate in June will rise by P0.3982 per kWh. This means an increase of P119.46, P159.28, and P199.10 for those consuming 300 kWh, 400 kWh and 500 kWh, respectively.

Meralco said higher power generation costs had driven rates higher.

For this month’s billing, the generation charge went up by P0.3313 to P6.5590 from P6.2277 per kWh previously. The pass-through cost is paid to the power suppliers.

The company said charges from independent power producers (IPPs) and power supply agreements (PSAs) rose by P0.6083 and P0.0859 per kWh, respectively, mainly because of higher fuel costs.

It said fuel charges from the power plants under First Gas Power Corp. increased by 8% due to the higher usage of more expensive liquid fuel with the extended Malampaya gas supply restriction.

“Coal prices also went up by an average of 23%, contributing to the higher IPP and PSA charges,” Meralco said.

It added that prices at the wholesale electricity spot market (WESM) “remained elevated” after the secondary price cap was imposed twice in the last supply month, on April 29 and 30.

In May, peak demand in the Luzon grid hit a record 12,113 megawatt after the easing of mobility restrictions and the resulting rise in economic activity.

Meralco said June’s generation charge covers the last of three installments of the deferred generation costs for the March bill and the second of three installments for the April bill. It said the inclusion accounted for about P0.20 per kWh of the generation charge.

“PSAs, IPPs, and WESM accounted for 48%, 40%, and 12%, respectively, of Meralco’s energy requirement,” the company said.

Meanwhile, the transmission charge for residential customers is set to increase by P0.0083 per kWh, while taxes and other charges will also rise by P0.0586 per kWh. The collection of P0.0025 per kWh as universal charge for the environmental remains suspended as ordered by the Energy Regulatory Commission.

“The implementation of distribution-related refunds continues to temper the overall power rate. For residential customers, the total refund is equivalent to P0.9353 per kWh,” Meralco said, adding that it only earns from distribution, supply, and metering charges, which have stayed unchanged since the reduction in July 2015.

Pass-through charges from generation and transmission are paid to the power suppliers and the system operator, respectively. Taxes, universal charges, and the feed-in tariff allowance, or FiT-All, are remitted to the government.

On Friday, shares in Meralco slipped by 2.59% or P9.60 to close at P360.40 apiece at the stock exchange.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Victor V. Saulon

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