Meralco slashes rate to 3-year-low

By Jordeene B. Lagare – September 10, 2020
from The Manila Times

This 2018 file photo shows linemen about to inspect electricity meters. (The Manila Times file photo)

Consumers can expect another reduction in their electricity bills in September after the Manila Electric Co. (Meralco) on Wednesday cut its power rate for the fifth straight month to what it described as a three-year-low.

In a statement, the listed power distributor said it sliced the rate by P0.0623 per kilowatt hour (kWh) to P8.4288/kWh from P8.4911/kWh in August.

“This month’s overall rate is also the lowest in three years or since September 2017,” it added.

Households consuming 200 kWh will see their power bills reduced by P12.46; 300 kWh, P18.69; 400 kWh, P24.92; and 500 kWh, P31.15.

For the sixth straight month, Meralco’s generation charge dipped by P0.0381/kWh to P4.0860/kWh in September from P4.1241/kWh last month.

“Because of the reduced power demand in its service area during the community quarantine period, Meralco continued to invoke the force majeure provision in some of its power supply agreements,” the company said.

In a virtual briefing on Wednesday, Lawrence Fernandez, Meralco head of utility economics, said demand within his company’s coverage area peaked at around 10,400 megawatts (MW) in August, lower than July’s 10,595 MW.

Within the “Meralco service area, the reduction was more than 200 MW,” he added.

Meralco’s force majeure claims amounted to about P463 million, which translate to savings of P0.1710/kWh in the generation charge.

Without these, the charge and total rate would have increased by 13 centavos/kWH and 14 centavos/kWh, respectively.

For the past six months, savings from such claims totaled around P2.4 billion.

Asked how long Meralco would invoke force majeure, Fernandez said that would depend on demand within its franchise area.

Wholesale Electricity Spot Market charges dropped by P0.0147/kWh lower this month on reduced demand in Luzon as some areas, including Metro Manila and its neighboring provinces, were again placed under modified enhanced community quarantine from August 4 to 18.

Purchases from independent power producers inched up by P0.0601/kWh and the transmission charge for residential customers fell by P0.0112/kWh.

ERC penalty

Meanwhile, Meralco spokesman Joe Zaldarriaga said his company might announce its next move on the P19-million penalty imposed by the Energy Regulatory Commission (ERC) either “this week or in the next.”

The state-run regulator slapped the fine on August 27 following complaints of unusually high charges during the lockdown period.

In explaining the move, the ERC said Meralco violated the advisories it issued during the community quarantines that started in mid-March.

“We’ll probably announce (Meralco’s next move) in due time,” Zaldarriaga said, adding that the firm’s lawyers were studying the agency’s order.

“But hopefully soon, we will be able to give you a more concrete answer insofar as the penalty is concerned. Hopefully, this week or in the next,” he added.