THE COST of electricity in May will decrease by P0.5436 per kilowatt-hour (kWh), largely because of a drop in the generation charge, distribution utility Manila Electric Co. (Meralco) said on Tuesday.
This brings the overall rate to P10.0041/kWh from April’s P10.5477/kWh. A typical residential customer with a 200-kWh consumption will see a P109 reduction in the monthly bill.
For households consuming 300 kWh, 400 kWh and 500 kWh, the corresponding reduction in their monthly bills will be P163.03, P217.44 and P271.80, respectively.
“The lower May rate is mainly due to the P0.4212 per kWh decrease in the generation charge,” Meralco said in a statement.
From P5.4735/kWh in April, the generation charge for May will stand at P5.0523 per kWh.
Meralco said charges from Wholesale Electricity Spot Market (WESM) slipped by P1.0139/kWh, despite increased demand for power in the Luzon grid with a number of power plants returning online after their scheduled maintenance shutdown.
“The share of WESM purchases to Meralco’s total requirement this month was 22%,” Meralco said.
The cost of power from independent power producers (IPPs) dropped by P0.5920/kWh due to Quezon Power Philippines Ltd.’s return to normal operations from its planned maintenance.
“The improvement in average plant dispatch more than offset the upward adjustment due to higher Malampaya natural gas prices resulting from the quarterly repricing that reflect recent movement of crude oil prices in the world market,” Meralco said, adding that IPPs provided 45% of its total energy requirement.
Purchases from power supply agreements (PSAs) went up by P0.2096 per kWh after the scheduled maintenance outage of Pagbilao unit one and Ilijan unit one, and the quarterly repricing of Malampaya natural gas.
The share of PSA purchases to Meralco’s total requirement for the month was 33%, the power distribution utility said.
During the month, transmission charges to residential customers also slipped by P0.0096/kWh. With the lower generation and transmission charges, taxes and other charges also declined by P0.1128/kWh.
“Meralco’s distribution, supply, and metering charges, meanwhile, have remained unchanged for 34 months, after these registered reductions in July 2015,” it said.
The company reiterated that it does not earn from 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 privately owned National Grid Corporation of the Philippines.
Taxes and other public policy charges, including the feed-in-tariff allowance, are remitted to the government.
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT, Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — Victor V. Saulon

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