Meralco cuts rates by 70.67 centavos per kilowatt-hour

Typical households in Metro Manila will see a decrease of around P141 in their electric power bills this month due to the refund order issued by the Energy Regulatory Commission.

Manila Electric Company’s overall rate for a typical household or those consuming 200 kilowatt hours went down by 70.67 centavos per kWh to P9.7545 per kWh in July.

Meralco said this month’s reduction effectively reversed all increases in the overall power rates since the start of the year.

It said the overall rate reduction was driven by the ERC’s decision to recalculate the difference between the actual weighted average tariff and the final interim average rate of P1.3522 per kWh during the lapsed period of July 2015 to June 2022.

The ERC order dated June 16 directed Meralco to implement an additional distribution true-up refund totaling P21.8 billion for 12 months or until the amount is fully refunded.

This is equivalent to a refund of P0.8656 per kWh for residential customers and will appear as a separate line item called “Dist True-up 4” in the power bills starting in July.

“As a highly regulated entity, Meralco’s rates undergo a review and confirmation process to make sure they are fair and reasonable. The immediate implementation of the ERC Decision was able to more than offset the impact of higher generation charge this month to the benefit of our customers,” said Jose Ronald V. Valles, Meralco head of Regulatory Management.

The generation charge for July went up by P0.2166 to P6.7756 from the P6.5590 per kWh registered the previous month.

Charges from the Wholesale Electricity Spot Market (WESM) increased by P3.9649 per kWh amid tight supply conditions in Luzon.

Meralco’s power supply agreements (PSAs) also saw charges increase by P0.3186 per kWh.

The peso depreciated by five percent this month, the steepest decline in the peso’s value since June 2003, affecting around 32 percent of PSA costs that are dollar-denominated.

The continued increase in international coal prices also contributed to the rise in the PSA rate.

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