Meralco hikes February rates, ends two-month cuts

Households will pay more for electricity this February as Manila Electric Co. (Meralco) raised rates, snapping two consecutive months of declines. A typical residential customer consuming 200 kilowatt-hours (kWh) will see their monthly bill climb by around P45.

Meralco said Tuesday that rates increased by P0.2226 per kWh, bringing the total to P13.1734 per kWh from P12.9508 in January. 

The rise was mainly driven by higher transmission charges, which jumped P0.1975 per kWh due to increased ancillary service costs and higher power delivery service fees.

A P0.0770 per kWh increase in the Universal Charge for Missionary Electrification also contributed, following Energy Regulatory Commission (ERC) approval of a new rate of P0.2763 per kWh from P0.1993 previously. Other charges, including taxes, added a net P0.0554 per kWh.

The rise was partially offset by lower generation costs, which fell by P0.1073 per kWh to P7.6398 per kWh, thanks to cheaper power from Independent Power Producers (IPPs). 

These decreases, however, were outweighed by higher charges from the Wholesale Electricity Spot Market (WESM) and Power Supply Agreements (PSAs), which rose due to tighter supply in Luzon and planned maintenance shutdowns of key plants ahead of the dry season.

IPPs, WESM, and PSAs accounted for 24 percent, 10 percent, and 66 percent of Meralco’s energy supply, respectively.

Pass-through charges for generation and transmission are paid directly to power suppliers and the grid operator, while taxes, universal charges, and renewable energy subsidies go to the government. Meralco’s distribution charge has remained unchanged since August 2022.

Relatedly, the ERC mandated a new uniform national lifeline threshold for low-income households, including 4Ps beneficiaries, giving a 100 percent discount to those consuming 50 kWh or less. Meralco will continue existing lifeline discounts beyond this threshold.

“We welcome this directive from the ERC which we hope will provide additional relief to our qualified customers,” Meralco Vice President and Head of Corporate Communications Joe R. Zaldarriaga said.

“We reiterate our call for customers to practice energy efficiency as we approach the dry season,” Zaldarriaga added.