AFTER five straight months of power rate cuts, average households using 200 kilowatt-hours (kWH) will see their total electricity bill this month to increase by around P9 after Manila Electric Co. (Meralco) announced a rise in the overall energy generation charge.

In a statement on Tuesday, the distribution utility said the electricity rate in October will be higher by P0.0448 per kWh to P9.0862/kWh from P9.0414/kWh the preceding month.

Those using 300 kWh, 400 kWh and 500 kWh can expect their bills to go up by P13.44, P17.92 and P22.40, respectively.

“Even with the slight increase this month, following five straight months of decrease, there has been a total downward adjustment of electricity rates amounting to almost P1.47 per kWh since April 2019,” the company said.

Meralco said the generation charge for October moved up by P0.0215/kWh to P4.5406/kWh from P4.5191/kWh because of the smaller net settlement surplus (NSS) refund during the month.

NSS is the remaining surplus or deficit after all market transactions have been accounted for. This accounts for price differences occurring between the power generator and customer locations or nodes because of losses and congestion. It is distributed to trading participants that are entitled to receive a share of the surplus or deficit in accordance with an Energy Regulatory Commission (ERC)-approved methodology.

For October, a smaller NSS refund was recorded by the Wholesale Electricity Spot Market (WESM), hence, the increase from the preceding month. In September, the power rate reduction was in part because of the NSS refund of around P684 million, bigger than the P381 million refund in October.

WESM charges also decreased by P0.5290/kWh after the power supply situation in the Luzon grid improved, with fewer power plants reporting outages. These charges also included the second installment of the NSS refund, as directed by the ERC in an Aug. 1 order.

Meanwhile, the transmission charge for households slightly increased by P0.0249/kWh as a result of higher ancillary service charges.

Taxes and other charges decreased by P0.0016/kWh.

Meralco said its distribution, supply and metering charges had been unchanged for 51 months, after these registered reductions in July 2015. It reiterated that it does not earn from the pass-through charges, including the generation and transmission charges.

Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the system operator National Grid Corporation of the Philippines. Taxes and other public policy charges like the feed-in tariff allowance rate 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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