Hike in Meralco rates this June looms
By Myrna M. Velasco – June 7, 2022, 2:30 PM
from Manila Bulletin
Filipino consumers will need to tighten their belts further, as the next burden in their budgets could be uptick in electric bills, primarily those under the Meralco franchise area.
Based on initial estimates, Meralco Vice President Joe Zaldarriaga indicated that the generation charge component of the power firm’s rates will most likely increase in June billing because of surging fuel prices in the world market.
“We expect the persisting increases in global fuel prices – particularly coal – and the continued use of liquid fuel due to the ongoing Malampaya gas supply restriction to weigh on the generation costs of our suppliers this month,” explained Zaldarriaga.
Zaldarriaga qualified though that the company is still waiting for the final billings from all of its power suppliers, “but initial indications show a possible upward adjustment in the generation charge of the June bills.”
Overall though, Meralco noted that its generation charge at P6.23 per kilowatt hour (kWh) in the May bills was still relatively lower compared to the other distribution utilities (DUs) and electric cooperatives (ECs) in the Luzon grid.
The generation charge accounts for more than 50 percent of the overall pass-on rate. Hence, it is the biggest fraction of cost components being reflected in the electric bills of consumers on a monthly basis.
The Luzon power utilities with higher generation charges vis-à-vis that of Meralco include Zambales Electric Cooperative I at P9.18 per kWh; La Union Electric Cooperative at P8.10 per kWh; First Laguna Electric Cooperative Inc. at P7.88 per kWh; Peninsula Electric Cooperative Inc. at P7.69 per kWh; Batangas II Electric Cooperative Inc. at P7.25 per kWh, Pampanga I Electric Cooperative Inc. at P7.18 per kWh; and Dagupan Electric Corporation at P6.59 per kWh.
The utility firm expounded that while power distributors in the country have varying contracting strategies for their power supply, most if not all, “have been affected by the persisting high fuel prices in the international market.”
The protracted Russia-Ukraine war has been recurrently triggering swell in fuel prices, primarily for coal and gas, which are the dominant fuel commodities used for electricity generation in the country.
It was emphasized that the distribution utilities with high contract volumes from coal plants had been heavily affected by the swelling fuel prices in the world market.
For gas utilization of power plants, in particular, the recurring ‘gas restriction’ dilemma at the Malampaya field has likewise been compelling the importation of more liquid fuels by the affected power producers.
Specifically, the gas-fed power plants of First Gen Corporation, which are suppliers of electricity to Meralco, had been leaning more and more on liquid fuel importation because of limited gas it has been drawing from Malampaya.
