Electricity rates this January may see only minimal movement despite pressures from a weaker peso and the introduction of a new renewable energy charge, according to Joe R. Zaldarriaga, Vice President and Head of Corporate Communications of the Manila Electric Company (MERALCO).

“We are still awaiting the billings from our power suppliers but very initial indications show that there may be minimal movement in the electricity rates this month,” Zaldarriaga said.

“There is an upward pressure in the generation charge primarily due to the weakening of the Peso against the US dollar, which affects a significant portion of power supply costs that are dollar-denominated,” he added.

Zaldarriaga said the impact of foreign exchange movements could be tempered by market conditions. “We hope this will be mitigated or offset by lower WESM prices during the December supply month, as announced by the IEMOP,” he said.

He also pointed to the implementation of the Green Energy Auction Allowance as another component affecting January bills. 

“Another factor that will affect the rates this January is the collection of the Green Energy Auction Allowance (GEA-All) as approved by the Energy Regulatory Commission,” Zaldarriaga said. “This is equivalent to an additional PHP 0.0371 per kWh that will appear as a separate line item in customers’ bills beginning this month.”

Zaldarriaga stated the company will release the final figures once all inputs are complete. “We will announce the final rate adjustment once all data is available,” he said.

Despite these factors, he said consumer behavior could help temper overall electricity bills. “Nonetheless, we remain optimistic that the decrease in demand and consumption of customers will help manage the electricity bills this January,” Zaldarriaga concluded.

As electricity rates continue to reflect market conditions, currency movements, and regulatory charges, how can consumers better understand the different components that make up their monthly power bills?

Follow Power Philippines on Facebook and LinkedIn or join our Viber community for more updates.