MM power rates likely lower this month

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Ahead of an official announcement today, June 8, Manila Electric Co. (Meralco) said power rates this month will likely decrease due to the suspension of some charges.

Lawrence Fernandez, Meralco vice president and head of utility economics, said any increase from the collection of the feed-in-tariff allowance which will resume this month will be offset by the suspension of environmental charge component of the universal charges as well as the expected savings on fixed costs on generation supply.

The power distribution company has invoked the new coronavirus disease 2019 as force majeure (FM) that enabled it to pay lower generation costs as the actual amount of power consumed were lower than the contracted supply. This led to a lower pass-on charge to the company’s customers.

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“May’s FM savings will be smaller when compared to April’s savings of more than P800 million, as only a portion of the May supply month was under enhanced community quarantine (ECQ),” Fernandez said.

In a virtual briefing, Fernandez said Meralco’s collection rate last April dropped to as low as 3 percent but this gradually increased last month after several payment channels were introduced.

He said power demand in its franchise area is recovering, hitting a peak of 10,400 megawatts (MW) last week from a low of 8,000 MW when ECQ started.

“We are averaging 10,400 MW which is the highest since the ECQ period started. Right before the ECQ, we were already around 11,000 MW. On the first week of ECQ, we were at the 8,000 MW levels so there is already a big increase in demand but still somewhat below right before the ECQ,” Fernandez said.

Meanwhile, in the aftermath of Typhoon Ambo and the lifting of the ECQ, Senate committee on energy chairman Sherwin Gatchalian has urged the Department of Energy (DOE) to ensure continuous delivery of electricity services in every household for students to utilize alternative learning modalities while schools prepare for the new normal.

Citing data from the DOE, Gatchalian said 1.9 million households have yet to be connected to the power grid or 7.71 percent of total households in the country. Majority of them are in Mindanao with 1.2 million and Luzon and Visayas at 364,409 and 333,329, respectively.

Gatchalian said the DOE had committed a 100 percent electrification in the country by the end of the year with P500 million allocated for the Total Electrification Program out of the agency’s P2.3-billion budget for the year.

He said the DOE must come up with strategies and roll out plan on how it can to provide reliable electricity service in unserved and underserved areas done through the use of new technology such as microgrid systems.

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