CUSTOMERS of the country’s biggest electricity distributor will have to pay more for the third straight month in April due to an increase in generation charge, which accounts for more than half of a household’s bill.

The Manila Electric Co. (Meralco) announced in a press release on Monday that the overall electricity rate will increase by P0.0633 per kilowatt hour (/kWh) to P10.5594/kWh from P10.4961/kWh in March.

This will result in bill increases of P13 for a household consuming 200 kWh which is Meralco’s biggest residential customer segment, as well as P18, P24 and P30 for those using 300 kWh, 400 kWh and 500 kWh, respectively.

“From P5.5973/kWh last month, generation charge for April slightly went up to P5.6322/kWh, an increase of P0.0349/kWh,” the company said, referring to the bill charge reflecting what it paid for power purchases in the March supply month.

The hike in generation charge was due to a P1.2815/kWh increase at the Wholesale Electricity Spot Market (WESM) — which accounted for 10.4% of Meralco’s supply — due to “tighter supply conditions in the Luzon grid.” The National Grid Corporation of the Philippines (NGCP) placed the Luzon grid under “yellow alert” — amid thin reserves — from March 5 to 8 as some power plants were affected by outages and de-ration.

Electricity from Independent Power Producers — which provided 41.4% of Meralco’s supply — edged up P0.0881/kWh due to a weaker peso-dollar exchange rate given that 95% of IPP charges are dollar-denominated.

On the other hand, charges from Power Supply Agreements — which accounted for 48.2% of Meralco’s supply — decreased by P0.2796/kWh.

Meanwhile, the Energy Regulatory Commission approved a P0.0337/kWh reduction in Feed-In Tariff Allowance, while a P0.0163/kWh adjustment was made on Universal Charge-Stranded Debts leading to a net reduction of P0.0174/kWh.

Transmission charge, taxes and other charges to residential customers inched up P0.0458/kWh, Meralco said, adding that its “distribution, supply, and metering charges, meanwhile, have remained unchanged for 45 months, after these registered reductions in July 2015.”

The Energy department said last month that it expected Luzon to post peak demand of 11,403 megawatts (MW) in May. The March-June period, when the country will experience a “weak” El Niño, is expected to see a 30% reduction in hydropower capacity to 983-1,776 MW.

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. — Vincent Mariel P. Galang

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