Meralco pushes 45 cents per kwh rate hike

MANILA, Philippines - An additional 7.5 centavos per kilowatt-hour will be imposed in the monthly generation charge of electricity consumers for a period of six months after the  Manila Electric Co. (Meralco) sought to recover unbilled charges for January amounting to 45 centavos per kwh.

On March 20, Meralco asked the Energy Regulatory Commission (ERC) for permission to recover the 45-centavo unbilled amount for a period of six months or 7.5 centavos per kwh every month to start immediately upon approval.

This followed the ERC’s March 3 order voiding the November 2013 and December 2013 rates at the Wholesale Electricity Spot Market (WESM), which affected Meralco’s December 2013 and January 2014 electricity bills.

Originally, Meralco’s January 2014 generation charge rose to P10.23 per kwh, but the power distributor pegged it at only P5.67 per kwh in deference to the the Supreme Court (SC)’s temporary restraining order (TRO) last year on Meralco’s December 2013 generation charge.

On March 3, ERC ordered market operator Philippine Electricity Market Corp. (PEMC) to void the rates at the WESM for the November 2013 and December 2013 supply months and to re-calculate the charges using regulated rates.

In response, PEMC said the re-calculated rates are P6.2 per kwh for the December 2013 supply month.

Following the re-calculated rates, Meralco said the revised January 2014 generation charge is now P6.118 per kwh instead of the original P10.23 per kwh.

Meralco proposed “to bill its customers an incremental generation charge of P0.0751 per kwh every month for a period of six months or until the P1.309 billion is fully recovered.”

The P1.309 billion is the unrecovered generation cost of Meralco for power purchased from US power company AES Masinloc and San Miguel’s Sual coal plant, based on the re-calculated PEMC rates.

Meralco told the ERC: “With respect to the December 2013 supply month, the reduction in the WESM bills to Meralco and the corresponding adjustment in the cost of replacement power of AES-Masinloc and SMEC-Sual resulted in a reduction of P9.765 million in the total generation cost, which translates to a revised generation charge for January 2014 of P6.1180 per kwh. Since recovery for the January 2014 billion to Meralco’s customers was pegged at P5.6673 per kwh, there remains a total unrecovered amount of P1.309 billion.

“Accordingly, Meralco proposes that it be allowed to bill to its customers an incremental generation charge of P0.0751 per kwh every month for a period of six months or unlit the balance of P1.309 billion is fully recovered,” Meralco also said.