THE Manila Electric Company (Meralco) announced a decrease in electricity rates for December.
In a press release yesterday, Meralco cut the power rate by P0.3785 per kWh for a typical
household, thereby bringing down the overall rate from last month’s P9.6272 per kWh to P9.2487 per
The rate decrease this month amounts to P76 reduction in the total bill for a typical
residential customer consuming 200kWh.
The lower December rate is mainly due to a P0.3035 per kWh reduction in the generation charge.
The generation charge decreased from P4.9080 per kWh in November to P4.6045 per kWh this month
primarily due to the peso’s appreciation and lower Wholesale Electricity Spot Market (WESM) charges.
Despite a slight increase in the demand for power in Luzon in November, charges from the WESM
decreased by P0.4658 per kWh. The power supply situation improved from October when the grid
experienced three instances of Yellow alerts. The share of WESM purchases to Meralco’s total
requirement this month was 12%.
Charges from independent power producers (IPPs) and power supply agreements (PSAs) also
registered decreases of P0.2191 per kWh and P0.3244 per kWh, respectively, mainly due to the
strengthening of the peso against the US dollar
The peso-dollar exchange rate affects around 97% of IPP and 60% of PSA charges. IPPs and PSAs
each provided 44% of Meralco’s total requirement.
Meralco’s distribution, supply, and metering charges, meanwhile, have remained unchanged for
29 months, after these registered reductions in July 2015.
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.