MANILA, Philippines – The Manila Electric Company (Meralco) is advising its customers that power prices will increase slightly in October.
Following a P1.73 per kWh reduction in power prices in September, a residential customer with a consumption of 200 kWh will see a P0.12 per kWh increase in their electric bill.
The increase in power prices this October is a result of higher generation, transmission, and other pass-through costs.
The generation charge increased by P0.10 per kWh, from P5.40 per kWh in September to P5.50 per kWh in October.
The increase was due mainly to higher charges from the Wholesale Electricity Spot Marker (WESM), which went up by P1.16 per kWh.
After the holidays and rainy weather of August led to depressed demand for power, September saw an increase in consumption of electricity. On the other hand, there was a reduction in available generation capacity, and the output of coal-fired plants was restricted due to repairs and maintenance.
These eventually led to increases in WESM prices.
The higher WESM charges were partially offset by lower prices from Independent Power Producers (IPPs), whose rates decreased by P0.09 per kWh, and the National Power Corporation (NPC), which registered a decrease of P0.22 per kWh.
WESM, IPPs and NPC contributed 6.0%, 44.1%, and 49.0%, respectively, to Meralco’s power supply requirements in September.
The transmission charge also went up by P0.04 per kWh. This was due to higher ancillary generation costs, which are affected by WESM charges.
With higher generation and transmission charges, the system loss charge similarly increased by P0.02 per kWh.
Meralco said it does not earn from the generation and pass-through charges. Payment for generation charges goes to power producers (NPC, IPPs, WESM). Transmission and system loss charges meanwhile go to the National Grid Corporation of the Philippines and other generating companies.
Meralco charges only account for about 16% of the total electricity bill. The rest of the pass-through costs include taxes, subsidies and other charges.