Power retailer Manila Electric Co. announced Friday an increase of P0.2744 per kilowatt-hour in the overall rate for a typical household to P8.7497 per kWh in January from P8.4753 per kWh in December.
The rate is equivalent to an increase of around P55 in the monthly bill of Meralco residential customers consuming an average of 200 kWh.
Meralco spokesman Joe Zaldarriaga said despite the increase, this month’s overall rate was still more than P0.70 per kWh lower than January 2020’s rate of P9.4523 per kWh.
Meralco consumers experienced a series of power rate reductions in 2020 amounting to P1.39 per kWh for the entire year.
Zaldarriaga said mitigating this month’s rate increase was the inclusion of Energy Regulatory Commission-approved adjustments for Meralco’s pass-through over/under-recoveries for the period January 2017 to December 2019.
The ERC, in an order released Dec. 29, directed Meralco to refund over-recoveries in transmission and other charges over a period of three months until fully refunded and to collect an under-recovery in the generation rate for 24 months until fully collected.
“The initial impact to residential customers is a net refund of around P0.1150 per kWh,” Zaldarriaga said.
He said the overall rate increase in January was driven by higher generation charges. The January generation charges amounted to P4.4574 per kWh, or P0.3058 higher than the December generation charge of P4.1516 per kWh.
Zaldarriaga said the rates of Meralco’s power supply agreements and independent power producers increased by P0.2723 and P0.2428 per kWh, respectively as Luzon’s peak demand in December decreased by 252 MW to 9,634 MW from 9,886 MW on cooler temperature and more non-working holidays compared to November.
The demand for power in Meralco’s franchise fell to its lowest level in December since the lifting of the enhanced community quarantine in May.
The lower demand led to fixed costs from power suppliers being spread over lower energy volume, resulting in higher effective generation rates to consumers, according to Meralco.
Meanwhile, the rate from the Wholesale Electricity Spot Market, the country’s trading floor of electricity went down by P0.6135 per kWh.
Meralco sourced 56.4 percent from its PSAs, 37.3 percent from its IPPs and 6.3 percent from the WESM for its supply requirements in December.
Transmission charges for residential customers registered a reduction of P0.0236 per kWh following the refund of transmission over-recoveries, while taxes and other charges registered a net decrease of P0.0078 per kWh, despite the recently approved increase in Feed-in Tariff Allowance.
ERC also authorized the collection of a FIT-All of P0.0983 per kWh effective January which resulted in a P0.0488 per kWh increase in the FIT-All this month, from the previously approved FIT-All of P0.0495 per kWh.
The collection of the universal charge-environmental charge amounting to P0.0025 per kWh was still suspended, as directed by the ERC.
Meralco’s distribution, supply, and metering charges were unchanged for 66 months.