Meralco to slash bills

By Neil Jerome Morales, The Philippine Star

Posted at Mar 20 2014 08:29 AM | Updated as of Mar 20 2014 04:29 PM

MANILA - The Manila Electric Co. (Meralco) will significantly reduce the December and January bills of consumers.

Betty Siy-Yap, chief financial officer of Meralco, told reporters yesterday that the December bill would drop to P5.9388 per kilowatt-hour from P9.1070 per kwh.

The January bill will decline to P6.1180 per kwh from P10.2279 per kWh.

“The issue was the WESM (Wholesale Electricity Spot Market) charge. WESM provided the recalculation,” Siy-Yap said.

Rates at the WESM, the country’s trading floor for electricity, in December 2013 and January should only be around P6 per kwh instead of P22 to P25 per kwh, according to the rates recalculated by spot market operator Philippine Electricity Market Corp. (PEMC).

As PEMC voided the high selling price of power generators, Siy-Yap said the generation charge for December was significantly reduced to P0.2715 per kwh from P3.44 per kwh while the January generation charge was pegged at P0.4507 per kwh from P4.5605 per kwh.

The December 2013 rate is still the subject of a temporary restraining order issued by the Supreme Court.

Siy-Yap said that for the January bill, Meralco already filed a petition for automatic recovery before the Energy Regulatory Commission (ERC).

The generation charge is the electricity bill’s biggest component. This charge goes directly to suppliers of Meralco, the country’s largest power distributor.

Meralco charges only account for about 16 percent of the total electricity bill. The rest of the pass-through costs include taxes, subsidies, and other charges.

Revised petition

Meralco will file today a revised petition to the ERC to implement about 40-50 centavos per kwh under-recovery cost in its generation charge, which was incurred during the height of price spikes at WESM last year due to the Malampaya shutdown.

In a statement, Meralco said it found the calculations of the ERC “correct.”

ERC earlier came out with its computation that Meralco should only be collecting 40-50 centavos per kwh to settle costs from its WESM transactions for October and November 2013.

“We are estimating that there will be a 70-80 percent reduction from the original P4.56 increase in generation charge in the said supply month, which impacted on the January 2013 bill. This, however, may still change depending on the final figures,” Meralco said.

Meralco said it has received on March 18 the new invoice from the PEMC for the December 2013 supply month that impacted on the January bills of its customers. – With Jess Diaz, Donnabelle Gatdula