Meralco announced that the average household electricity charge will increase up to P9.00 per kWh after coming from January’s all-time low rate of P8.09.
The rate adjustment is mainly due to the “upward movement in the generation charge”, according to a press statement issued by the electric distributor, in which they refer as a “normalization” of rates to complement Pagbilao’s and Ilijan’s resurged power levels this month.
Meralco spokesperson Joe Zaldarriaga said that despite high rates, the P8.55 average power rates for 2017 remain at par with 2016’s P8.50 per kWh, and is still considerably lower than 2015 rates which averaged at P9.44 per kWh.
The biggest cost driver in the price update remains covered by generation charge with an adjusted P0.62 per kWh, pushing the overall increase to P4.32 per kWh from the previous month’s P3.70 per kWh.
Taxes and additional power charges are also included in the rate adjustment with a combined amount of around P0.15 per kWh.
The generation rate increase was caused by “higher fuel prices” such as the recent repricing of Malampaya’s natural gas. The slow decline of the Peso against the U.S. Dollar is also a contributing factor to the price adjustment.
January 2017’s low power rates, Meralco says, was largely caused by the “reduction in capacity fees” from their annual reconciliation of outage allowances approved by the Energy Regulatory Commission (ERC).
The low electricity rates given to consumers “represent” as savings and the month’s decreased demand in power of about 400 mega watts (MW).