Electricity rates drop this January

Manila Electric Co (Meralco) has announced a decrease in electricity rates for January 2018. The decrease amounting to PhP 0.5260 per kilowatt hour (kWh) is seen to bring down the overall rate from last month’s PhP 9.2487 per kWh to PhP 8.7227 per kWh.

According to Meralco, the rate decrease this month amounts to close to a PhP 105 reduction in the total bill of a typical residential customers consuming 200 kWh. The lower January rate is mainly due to a P0.5277 per kWh reduction in the generation charge. This is the second consecutive month of decrease in overall electricity rates, totaling a reduction of PhP0.9045 per kWh in the two-month span, Meralco said.

Generation charge decreased from P4.6045 per kWh in December to P4.0768 per kWh this January primarily due to lower Power Supply Agreements (PSA) and Wholesale Electricity Spot Market (WESM) charges.

Charges from the WESM also decreased by P1.6943 per kWh due to lower spot prices resulting from a reduction in power demand in the Luzon grid. The share of WESM purchases to Meralco’s total requirement this month was 19 percent.

Meralco reiterated that it does not earn from the pass-through charges, such as the generation and transmission charges. Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the NGCP. Taxes and other public policy charges like the FIT-All are collected by government.