Meralco rates likely to rise in February

Electricity rates in Metro Manila and nearby provinces are likely to go up this month, as initial indications from Manila Electric Co. (Meralco) point to increases across several cost components.

In a statement on Monday, Meralco Spokesperson Joe R. Zaldarriaga said that although the company has yet to receive the final billings from its suppliers, there is an upward pressure on several pass-through charges.

He said the increase in the power prices in the Wholesale Electricity Spot Market (WESM) likely have contributed to the higher generation charge.

Tight supply margins in Luzon drove the average WESM price 9% higher month on month to PHP 3.25 per kilowatt-hour (kWh). Power supply fell by 8.3% to 13,228 megawatts (MW), while demand slipped by 8% to 8,574 MW.

Meanwhile, power procured from Meralco’s suppliers is expected to have increased due to the peso depreciation, which affected their costs that are mostly dollar denominated.

The peso closed at PHP 58.86 per dollar on Jan. 30, weakening by seven centavos from its PHP 58.79 finish on Dec. 29.

“There is also a possible increase in transmission charge due to higher market prices for regulating and contingency reserves,” Mr. Zaldarriaga said.

Meanwhile, he said that an additional PHP 0.08 per kWh will be charged to consumers following the approval of the Energy Regulatory Commission (ERC) of a new rate for universal charge for missionary electrification (UCME).

The ERC approved an increase in the rate for UCME to PHP 0.2763 per kWh from PHP 0.1993 per kWh previously.

UCME is a charge collected from on-grid electricity end-users used to subsidize the more expensive cost of providing power in off-grid areas.

“As these are still initial, the overall rate movement could still change,” the Meralco official said.

Last month, the power distributor decreased electricity rates by PHP 0.1637 per kWh month on month to PHP 12.9508 per kWh, driven by lower transmission charge.

The ERC earlier approved the cost recovery sought by four power generators amounting to PHP 31 billion in fuel cost recovery. As a result, Meralco will collect an additional PHP 0.2816 per kWh starting March.

Meralco is the country’s largest private electric distribution utility, serving over 8.1 million customers in Metro Manila and surrounding provinces, including Bulacan, Cavite, Rizal, and parts of Laguna, Batangas, Pampanga, and Quezon.

Meralco’s controlling shareholder, 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. — Sheldeen Joy Talavera