Meralco to slash December power rates as lower Luzon demand cuts gen charge

By VG Cabuag – December 10, 2020
from Business Mirror

POWER distributor Manila Electric Co. on Wednesday said it is slashing power rates in December mainly on lower generation charge due to decreasing demand in Luzon grid.

Power rates for a typical household decreased by P0.0352 per kilowatt hour to P8.4753 per kwh in December from last month’s P8.5105 per kwh.

This is equivalent to a decrease of around P7 in the total bill of residential customers consuming 200 kwh.

This month’s overall rate is also a net rate reduction of P1.3870 per kwh, equivalent to a bill reduction of more than P277 for a 200-kwh household, since the start of the year.

This the second lowest overall power rate in more than three years, or since September 2017, the company said.

Meralco spokesman Joe Zaldarriaga said it remains to be seen if the trend of lower rates can continue in the succeeding months.

“We’ve have one of the lowest rates already in the past years, so looking at January, its too early to tell at this point,” he said.

Meralco said power demand already saw an increase in December.

From P4.2018 per kwh in November, the generation charge decreased by P0.0502 per kwh to P4.1516 per kwh this December.

All sources of supply registered lower charges this month.

Meralco said there was a reduction in charges of P0.1881 per kwh from the Wholesale Electricity Spot Market.

The Luzon grid’s power supply situation improved in November following a drop in demand due to successive weather disturbances. From October 2020’s peak demand of 10,344 megawatts, the November 2020 peak demand decreased to 9,886 MW. Also, due to the effects of Typhoon Ulysses, the WESM was suspended by Energy Regulatory Commission from November 12 to 13, 2020.

The cost of power from the Independent Power Producers also decreased by P0.2577 per kwh due to improved average plant dispatch and Peso appreciation.

Charges from power supply agreements also went down by P0.0214 per kwh with the strengthening of the peso against the US dollar.

Meralco said it will abide by the regulator’s decision not to cut the power service of those consuming 200 kwh per month, who have not yet paid their bills since the start of the pandemic in March. However, it may start disconnecting the service of those who have unpaid bills by early next year.

“Obviously, that (disconnection) may happen. We also need to look at the sustainability of our operations since Meralco is not the only one who provides service but also the electric coops … we need to pay the (energy) suppliers,” he said.