Malampaya shutdown triggers Meralco rate hike in November

MANILA, Philippines — Another month of rate hike awaits consumers of Manila Electric Co. (Meralco) in November after a shutdown in Malampaya’s natural gas facility pushed up generation charges. 

In a statement on Friday, the country’s largest power distributor said the overall rate for a typical household went up by P0.3256 per kWh in November, which is equivalent to a P65 increase in power bill of a residential customer with monthly consumption of 200 kilowatts per hour.

Meralco said it paid more for electricity it distributed to its franchise area because of maintenance shutdown of Malampaya gas field from October 2 to 25. That outage in the crucial energy facility, which supplies 40% of Luzon’s power needs, tightened energy supply, sending generation charge jumping by P0.2911 per kWh this month.

Specifically, the shutdown caused supply problems for Wholesale Electricity Spot Market (WESM) and independent power producers (IPPs), which have a combined 51.3% share to Meralco’s energy requirement. Charges from WESM got expensive by P1.7073 per kWh while power sourced from IPPs got costlier by P0.8186 per kWh.

Meanwhile, charges from power supply agreements, where Meralco sourced 48.7% of electricity it sold to consumers, went down by P0.2841 per kWh mainly due to “higher excess energy deliveries” and discounts from producers, namely AC Energy, First Gen Hydro Power, San Miguel Energy and South Premiere Power. 

As it stands, another round of higher power rates could fan inflation that has been hovering above the state’s 2-4% annual target for most of the year.

Meralco said the overall rate in November would have been higher, but the company asked some of its suppliers to defer the collection of portions of their generation costs. The deferred charges, in turn, will be billed on a staggered basis over the next four months.

At the same time, the company’s continued implementation of “Distribution Rate True-Up” refund which began last March also tempered the rate hike this month.

Transmission charge for residential customers decreased by P0.0403 per kWh due to “lower ancillary service and power delivery service charges,” Meralco said.