The Independent Electricity Market Operator of the Philippines (IEMOP) said it is optimistic that ample supply will cause power rates on the spot market to drop to P4 to P5 per kilowatt hour (kWh) this month.
In a virtual briefing on Tuesday, Isidro Cacho Jr., IEMOP head of trading operations, said the country has an “ample” energy supply, which is likely to allow spot market prices to be in the same range as last month, if not lower. “Hopefully, it still gets lower from around the current P4 to P5 [per kWh,]” he said.
IEMOP runs the Wholesale Electricity Spot Market (WESM), the nationwide trading center.
“Given the trend that we are seeing today, we have ample supply and the same margin level throughout May,]” Cacho said.
Earlier this week, IEMOP said the average cost of electricity in the country based on WESM declined by 15.3 percent in April, hitting P4.52 per kWh, compared to March’s average of P5.34 per kWh.
Despite the increased demand, the company attributed the decrease to higher power supply in April.
Cacho added that a low WESM price may persist throughout the year, especially with the expected entry of more renewable energy (RE) power facilities in the grid, leading to “more ample supply and generally stable prices.”
The IEMOP official said that if the current Grid Operating and Maintenance Program is followed and no unscheduled shutdowns occur outside of it, the country is expecting a stable power supply all year round, even if many power plants are scheduled to have their maintenance downtimes after the summer months.
Ahead of official announcements of rate adjustments for May, the Manila Electric Co. (Meralco) said in a separate statement on Monday night that the cost of electricity in its franchise area would likely drop due to lower WESM rates for the April supply month.
“We are still waiting for some billings, but indications point to a possible decrease in the generation and transmission charges,” said Joe Zaldarriaga, Meralco vice president and head of corporate communications.
Initial data shows WESM prices trended lower in the April supply month as power plants that went on outage started to resume operations, boosting capacity in the market, he said.
In comparison, during the March supply month, WESM prices were higher as capacity on outage reached almost 1,000 megawatts (MW) while demand increased by over 1,000 MW.
“We also see a possibility of lower transmission charges due to the decline in Reserve Market Prices as well as the completion of the 11-centavo per kWh collection of the February to March 2024 reserve market charges,” Zaldarriaga added.
Meralco is expected to announce its official May 2025 power rates movement within the week or next.
Last month, Meralco implemented a P0.7226 per kWh rate increase, mainly due to higher generation charges.
Last month’s adjustment was equivalent to an increase of P145 in the bill of a residential customer consuming 200 kWh monthly, bringing overall power rates to P13.0127 per kWh from the previous P12.2901 per kWh.
