Following ERC Order, MERALCO announces decrease in June rates

Customers of Manila Electric Company (MERALCO) can expect a significant reduction in June electricity rates, reversing the previously announced increase. 

This change comes as the power distributor implements a staggered collection of generation costs from the Wholesale Electricity Spot Market (WESM).

As a result, MERALCO customers will see a P1.9623 per kWh decrease in the June electricity rate, instead of the initially expected P0.6436 per kWh increase. This adjustment lowers the overall rate for a typical household to P9.4516 per kWh, down from the previous month’s P11.4139 per kWh. For residential customers consuming 200 kWh, this equates to a reduction of approximately P392 in their total electricity bill.

The adjusted June rate includes a P1.8308 per kWh decrease in the generation charge. Transmission charge and feed-in tariff allowance increases are retained at P0.1450 per kWh and P0.0474 per kWh, respectively. Taxes and other charges see a net reduction of P0.3239 per kWh.

In its order promulgated on June 13, the Energy Regulatory Commission (ERC) directed all distribution utilities and electric cooperatives, including MERALCO, to stagger the collection of charges for WESM purchases in the May supply month across four equal monthly installments, starting this billing month and continuing until September 2024.

“We ask for the understanding of our customers over the delayed bills as we implement the newly issued order of the ERC. Rest assured that MERALCO will implement adjusted due dates to give our customers enough time to pay their bills,” said MERALCO Vice President and Head of Corporate Communications Joe R. Zaldarriaga.

However, MERALCO has warned about the possibility of an increase in generation charges for the next three months, 

“We would like to advise this early that our customers can expect generation charges to increase in the succeeding months as we collect the deferred amounts on a staggered basis as a result of the recent developments,” Zaldarriaga added.

As previously announced, MERALCO, along with Quezon Power (Philippines) Ltd., San Buenaventura Power Ltd. Co., and South Premiere Power Corporation, deferred P500 million in generation costs to mitigate the impact of higher pass-through charges on MERALCO customers. These deferred costs will be collected over the next three billing periods, as cleared by the ERC.

“With these already deferred costs, and the recent order of the ERC to also stagger the collection of WESM charges, around P0.77 per kWh will be added every month to the generation charge in the July to September bills,” Zaldarriaga concluded.