Higher WESM prices push up MERALCO April rates


Customers of the Manila Electric Company (MERALCO) should indeed expect an increase in electricity bills for April as a result of higher rates in the Wholesale Electricity Spot Market (WESM), which in turn pushed up generation charges.

MERALCO will be charging Php8.4067 per kilowatt-hour (kWh) for April, Php0.0872/kWh higher than the Php8.3195/kWh rate in March. This translates to a Php17 increase for residential customers consuming 200 kWh.

WESM charges increased by Php2.5991/kWh due to tighter supply conditions in the Luzon Grid. Peak demand in Luzon increased by almost 1,000 megawatts (MW) in March as a result of warmer temperature, while unavailable capacity from plant outages remained above 3,400MW.

This resulted in a generation charge of Php4.537/kWh for April, Php0.1621 higher than the Php4.3749/kWh rate in March.

Energy Sec. Alfonso Cusi had said that Luzon encountered grid disturbance last Monday due to the outage of the GNPower Dinginin and the Pagbilao coal plants, specifically noting that the incidents led to automatic load dropping of some areas in Metro Manila and Luzon.

Mitigating the increase in WESM charges are the lower costs from Independent Power Producers (IPPs) and Power Supply Agreements (PSAs). Charges of IPPs and PSAs decreased by Php0.209 and Php0.1371/kWh, respectively, due to improved average plant dispatch and peso appreciation.

Transmission charge for residential customers decreased by Php0.0856/kWh mainly due to lower ancillary service charges, while taxes and other charges registered a net increase of Php0.0107/kWh.