Expect Lower Power Rates in August
Meralco distribution, supply, and metering charges have remained unchanged for 61 months. Photo from iStock.
Expect Lower Power Rates in August
The power utility promises its customers they will only pay for actual consumption.
by Cris Laraño
Good news for Meralco’s customers: Electricity rates will decline for the fourth straight month in August—pulled down further by lower power generation charge and transmission fee, and the continued suspension of the environmental charge.
Meralco said power rates in August for a typical household will decline by P0.21 per kWh to P8.49 per kWh, the lowest rates since September 2017 and over P1 per kWh cheaper than the P9.57 per kWh posted in August 2019.
Corporate Communications Head and Meralco spokesman Joe Zaldarriaga told a virtual news conference on Monday that the cost of power in the spot market declined on improved electricity supply in Luzon because of fewer plant outages, and the lower natural gas price as a result of quarterly repricing with Independent Power Producers, or IPPs. Meralco sources around 16 percent of its electricity supply from the spot market and 34 percent from IPPs.
Utility Economics Vice President and Head Lawrence Fernandez said Meralco took advantage of lower prices in the spot market and bought more electricity, while the decline in oil prices during the second quarter helped lower the cost of natural gas during the repricing.
Lower IPP and spot market prices offset the slight increase in existing power supply agreements, which account for 51 percent of Meralco's electricity mix, because of lower average plant dispatch and force majeure claims compared to previous months.
Meralco distribution, supply, and metering charges have remained unchanged for 61 months.
Fernandez said that even with the improvement in electricity demand in recent months, the electricity rate remains significantly lower compared to the same period in 2019. He said the outlook for power demand is still hazy and will depend on how quickly the economy could recover.
“For July alone, demand is 6 percent lower compared to last year’s level,” he said.
The Philippine economy entered a recession in the second quarter, when gross domestic product declined 16.5 percent year-on-year, the steepest decline since the government started recording the data in 1981.
Zaldarriaga said that even with the re-imposition of a modified enhanced community quarantine, Meralco business centers will remain open while meter readers will continue to be deployed to ensure only actual electricity usage are billed.
To learn more, contact your Relationship Manager, call 16210 or email us at corporatepartners@meralco.com.ph.
Story originally posted on Power Club.