Meralco Rates Increase Again in August

Customers of the Manila Electric Company (Meralco) will see higher electricity bills this month, as the company announced an upward rate adjustment due to increased transmission charges.

Meralco’s advisory indicates a rate hike of P0.0327 per kilowatt-hour (kWh) in August, raising the overall rate for a typical household to P11.6339 per kWh from July’s P11.6012 per kWh. This translates to an approximate increase of P7 for residential customers consuming 200 kWh.

The rate increase is primarily due to a P0.1086 per kWh rise in transmission charges, driven by higher ancillary service charges from the grid operator, which more than doubled for contingency and dispatchable reserves.

This increase offset a P0.0503 per kWh reduction in generation charges. Charges from independent power producers (IPPs), which make up 33% of Meralco’s energy supply, dropped by P0.2974 per kWh. However, prices in the wholesale electricity spot market (WESM) rose by P0.5940 per kWh, and power supply agreement (PSA) charges, accounting for 40% of Meralco’s supply, increased by P0.0421 per kWh due to higher fuel-related costs.

Generation costs from First Gas – Sta. Rita and San Lorenzo are expected to rise as they transition to new Gas Sale and Purchase Agreements (GSPAs) following the expiration of the old GSPA in July. Regulatory approval is pending for the new GSPAs.

“Once the new GSPAs are approved, this will certainly affect the generation charges of Sta. Rita and San Lorenzo,” said Joe Zaldarriaga, Meralco vice president and head of corporate communications.

Meralco aims to achieve a core net income of at least P40 billion in 2024, buoyed by growth from the first quarter of the year.

Meralco operates electric distribution systems in Bulacan, Cavite, Metro Manila, Rizal, and parts of Batangas, Laguna, Pampanga, and Quezon. Its subsidiaries and associates include Vantage Energy Solutions and Management Inc. and MeridianX Inc., which serve as retail electricity suppliers in Luzon and the Visayas. — RSJ, GMA Integrated News