ELECTRICITY bills this month will slightly go up by P0.3297 per kilowatt hour (kWh), bringing the overall rate for a typical household to P10.2769 per kWh from the previous month’s P9.9472 per kWh.
For residential customers consuming 200 kWh, this is equivalent to an increase of around P66 in their total electricity bill, according to the Manila Electric Company (Meralco).
This month’s overall rate increase was mainly due to the completion of a distribution-related refund equivalent to P0.4669 per kWh for residential customers. There are still three ongoing refunds for residential customers, totaling P1.3340 per kWh, being implemented by Meralco that continue to to temper customers’ monthly bills. However, these are expected to be fully refunded by December 2022, January 2023 and May 2023, and the impact of the higher bills will subsequently be felt beginning June 2023.
For the next electricity bill, rates are expected to go higher because of the completion of one of the three refund orders and the result of the cessation of Meralco’s power supply agreement (PSA) with South Premiere Power Corp. (SPPC).
“There is an expected overall impact of an additional P0.28 per kWh in the January 2023 bills. The suspension of the SMC contract will also most probably result in an upward adjustment…But we are expecting an upward adjustment because of the completion of the refund in January and the possible impact of the suspension of SMC supply,” said Meralco spokesperson Joe Zaldariaga in a press briefing.
Meralco’s distribution charge, on the other hand, has not moved since the P0.0360 per kWh reduction for a typical residential customer beginning August 2022.
Generation charge went down by P0.1942 to P6.7975 from P6.9917 per kWh the previous month.
Charges from PSAs decreased by P0.2079 per kWh as the First Natgas-San Gabriel plant went back online last October 15 coming from the scheduled maintenance outage from October 1 to 14. The Peso’s appreciation, which affected 38 percent of PSA costs that are dollar-denominated, also contributed to the reduction.
Further pulling down the generation charge was the P1.3985 per kWh reduction in Wholesale Electricity Spot Market (WESM) charges due to the improved supply situation in the Luzon grid. While average daily capacity on outage remained at the 3,900-MW level, the reduction in both peak and average demand in the November supply month resulted in fewer impositions of the secondary price cap, which was triggered only 21 percent of the time in November versus October’s 52 percent.
Independent Power Producer (IPP) charges, on the other hand, inched up by P0.0545 per kWh. First Gas-Sta. Rita Module 10 was on scheduled outage from November 4 to 11 and on November 19 to 20, while Sta. Rita Module 40 was also on scheduled outage from November 12 to 27. The Peso’s appreciation tempered the increase in the IPP rate, as 98 percent of IPP costs were dollar-denominated.
IPPs, PSAs, and WESM accounted for 41 percent, 52 percent, and 7 percent, respectively, of Meralco’s total energy requirement for the period.
Transmission charge for residential customers increased by P0.0753 per kWh due to higher ancillary service charges of the National Grid Corporation of the Philippines.
Meanwhile, taxes and other charges registered a net decrease of P0.0183 per kWh mainly due to the absence of feed-in tariff allowance (FIT-All) following the issuance of the Energy Regulatory Commission’s Resolution, suspending the collection of P0.0364 per kWh FIT-All rate for three months starting December 2022 until the February 2023 billing periods.
Pass-through charges for generation and transmission are paid to the power suppliers and the grid operator, respectively, while taxes, universal charges, and FIT-All are all remitted to the government.