MANILA — The Manila Electric Company (Meralco) announced today a significant reduction of almost one peso or P0.9879 per kWh in the April electricity rate, bringing the overall rate for a typical household down to P10.9518 per kWh from P11.9397 per kWh in March.
For residential customers consuming 200 kWh, the adjustment is equivalent to a decrease of around P198 in their total electricity bill.
The substantial reduction in the overall electricity rate this month wiped out rate increases since January 2024, bringing the year-to-date adjustment to a net decrease of P0.3066 per kWh.
Lower generation, transmission charges bring down overall rate
Both generation and transmission charges registered sharp decreases this month.
The generation charge had a reduction of P0.3613 per kWh owing to lower costs from Independent Power Producers (IPPs) and Power Supply Agreements (PSAs) that offset the increase in Wholesale Electricity Spot Market (WESM) prices.
Charges from IPPs went down by P1.0701 per kWh due to lower costs from First Gas plants. The reduction was mainly due to the non-use of liquefied natural gas (LNG) by Sta. Rita and San Lorenzo and continued withholding of incremental Malampaya gas costs for First Gas - Sta. Rita under its new Gas Sale and Purchase Agreement (GSPA).
Following an order issued by the Energy Regulatory Commission (ERC), the Malampaya pricing under First Gas - Sta. Rita’s old GSPA and only landed costs of LNG shall be passed through until separate ERC approval of full costs.
Similarly, charges from PSAs' decreased by P0.5733 per kWh mainly due to lower fuel costs of South Premier Power Corp. (SPPC) under the emergency PSAs with Meralco, as well as that of San Buenaventura Power Ltd. (SBPL).
On the other hand, charges from the WESM increased by P1.0114 per kWh due to tighter supply conditions in the Luzon grid. Average demand went up by 618 MW while average capacity on outage also increased by 473 MW. The secondary price cap was applied around 7 percent of the time, indicating periods of sustained high prices in the WESM.
IPPs, PSAs, and WESM accounted for 29, 46, and 25 percent, respectively, of Meralco’s total energy requirement for this period.
The transmission charge, meanwhile, went down by P0.4665 per kWh following the ERC’s suspension of settlements in the Reserve Market that drove the significant increase in ancillary service charges in the March electricity rates.
“The significant reduction in this month’s overall electricity rate more than wiped out the increases in power rates for the first quarter of the year. Despite the rate reduction, Meralco continues to encourage its customers to continue practicing energy efficiency, especially during summer when consumption historically increases anywhere from 10 to 40 percent due to warmer temperatures,” Meralco Vice President and Head of Corporate Communications Joe R. Zaldarriaga said.
Taxes and other charges
Taxes and other charges also registered a total decrease of P0.1601 per kWh.
Pass-through charges for generation and transmission are paid by Meralco to the power suppliers and the grid operator, respectively, while taxes, universal charges, and the Feed-In Tariff Allowance or FIT-All are all remitted to the government.
Meralco’s distribution charge, on the other hand, remained unchanged since the P0.0360 per kWh reduction for a typical residential customer beginning August 2022.
Meralco continues proactive implementation of demand-side management programs
With the dry season in full swing, Meralco has renewed calls for participation in the government’s Interruptible Load Program (ILP).
The ILP is an energy demand-side management program through which large-load customers are asked to use their generator sets or shift their operations, instead of drawing power from the grid, to spare households from power interruptions during instances of Red Alert or when supply is insufficient to meet the demand.
At present, there are over 100 companies with around 530 MW de-loading capacity across the Meralco franchise area that are enrolled in the ILP. Following the directive of the Department of Energy, the company intends to intensify its campaign to boost available capacity under the program.
Meralco also reminded its customers anew to continue practicing energy efficiency for better management of their consumption during this period.
These energy efficiency practices include unplugging appliances when not in use; optimizing the temperature setting of the air conditioner to 25℃ instead of 18℃ and regularly cleaning the filter; avoiding overfilling the refrigerator to ensure proper circulation of the cool air inside; ironing large batches of clothing at one time; and utilizing natural lighting when and where possible.
To better manage their electricity use, Meralco encourages its customers to use its Appliance Calculator (AppCal) available in the Meralco Mobile App. The AppCal provides information on the power consumption of various gadgets and major household appliances.
Customers can report power outages and other concerns through Meralco’s official social media accounts on Facebook (www.facebook.com/meralco) and X, formerly Twitter, (@meralco). They may also text their concerns to 0920-9716211 or 0917-5516211 or contact the Meralco Hotline at 16211 and 8631-1111.
