Power rates down, pump prices up
Credit to Author: Brix Lelis| Date: Sat, 12 Oct 2024 00:00:00 +0800
MANILA, Philippines — Power distributor Manila Electric Co. (Meralco) is lowering electricity rates by P0.3587 per kilowatt-hour this October, bringing down the overall rate to P11.4295 per kWh from last month’s P11.7882 per kWh.
This latest adjustment, which snaps a three-month uptrend, is equivalent to a decrease of about P72 in the electricity bills of typical households consuming 200 kWh.
At a press conference on Friday, Meralco spokesperson Joe Zaldarriaga said the decline was driven by about P0.31 per kWh reduction in generation costs due to lower power spot market prices.
The generation charge covers the cost of power purchased by Meralco from independent power producers (IPPs) and the Wholesale Electricity Spot Market (WESM), as well as through power supply agreements (PSAs).
Zaldarriaga said WESM charges decreased by P5.10 per kWh following the completion of the collection of staggered costs ordered by the Energy Regulatory Commission in June.
The improved power supply situation in the Luzon grid also contributed to lower rates this month as average demand declined by 544 megawatts and average capacity on outage went down by 519 MW.
Wholesale Electricity Spot Market, IPPs and PSAs, respectively, accounted for 24 percent, 26 percent and 50 percent of Meralco’s total energy requirement for the supply period.
Furthermore, the transmission charge was also down by P0.0383 per kWh due to lower ancillary service rates, or pass-through costs charged to support services used to stabilize the grid during supply-demand imbalance.
The National Grid Corp. of the Philippines, the grid operator, earlier said the lower ancillary service charges offset the slight increase in transmission wheeling rates, or what it charges for its primary service of delivering power.
Meanwhile, motorists should brace for another round of hikes in domestic pumps as fuel prices are expected to go up by at least P2 per liter next week.
The Department of Energy-Oil Industry Management Bureau (DOE-OIMB) estimated an upward adjustment of P2 to P2.30 per liter for gasoline, P2.35 to P2.65 per liter for diesel and P2.45 to P2.55 per liter for kerosene.
The estimates were based on the four-day trading in the Mean of Platts Singapore.
DOE-OIMB assistant director Rodela Romero attributed the increase in the rising tensions in the Middle East, which could “disrupt oil exports with an increasing war premium.”
Hurricane Milton, which made landfall near Sarasota, Florida in the US, also disrupted energy delivery links, Romero added.
Yesterday’s trading would determine the final price adjustments, which will be announced on Monday and will take place the following day.