Power rates in areas covered by the franchise of the Manila Electric Co. (Meralco) will increase for the second straight month in December driven by higher generation charges.
Meralco said in a statement on Tuesday the P0.1048 per kilowatt hour (kWh) increase in December brings overall power rates to P11.9617 from last month’s P11.8569 per kWh.
The adjustment is equivalent to additional P21 in the total bill of residential customers consuming 200 kWh monthly.
Meralco said this month’s overall rate adjustment was pushed by the P0.1839 per kWh increase in the generation charge, mainly due to increased costs from the Wholesale Electricity Spot Market (WESM) and Power Supply Agreements (PSAs).
WESM charges went up by P0.2531 per kWh driven by tighter power supply conditions in the Luzon grid as average capacity on outage increased by around 396 megawatts.
Charges from PSAs also increased by P0.1050 per kWh due to the depreciation of peso which affected around 51 percent of PSA costs and lower average PSA dispatch.
Meralco said the increase could have been higher if not for the P0.0410 per kWh decrease in charges from Independent Power Producers (IPPs) due to higher average dispatch with the return to normal operations of several power plants.
Transmission charge went down P0.0940 per kWh due to lower ancillary service charges from the reserve market while taxes and other charges increased by P0.0149 per kWh.
Meralco earns from distribution, supply and metering charges, which went down by P0.0360 per kWh in August 2022 and has not moved since. Of Meralco’s total power requirements for the month, 40.2 percent was from IPPs, 31.4 percent from WESM, and 28.3 percent from PSAs.
