After last month’s rate decrease of P0.29 per kilowatt-hour (kWh), Meralco continues to cut back with a P1.43 per kWh reduction for June, the company said at a press briefing on Thursday.
Generation charges are significantly lower wherein the average household consumption rate goes from P9.60 per kWh to P8.17 per kWh overall, totaling up to a P285.00 cut for residents with a 200 kWh power consumption.
The electricity provider’s petition for provisional authority on the refund order of P0.79 per kWh, excluding taxes, was approved by the Energy Regulatory Commission (ERC) last May.
In a company statement, June’s rate decrease is the result of the refund of recovery on pass-through charges from January 2014 to December 2016 totaling around P6.9 billion.
Another cost-reducing factor is the downward movement in the generation charge due to the higher plant dispatch of independent power producers (IPPs), wholesale electricity spot market (WESM) and power supply agreements (PSAs).
The overall generation charge dropped by P1.0253 per kWh, lowering last month’s P4.8838 per kWh to P3.8586 per kWh for June.
Furthermore, power sourced from IPPs decreased to P0.59; P1.25 per kWh for WESM; while PSA prices reduced to P0.04 per kWh.
Continuous Peso appreciation and completion of the recovery of liquid fuel cost during the Malampaya shutdown in January-February 2017 also helped lower IPP and PSA prices.
Meanwhile, WESM’s costs cut was due to fewer plant outages regardless of high power demand in Luzon.
That will translate to residential customers should see a decrease of P0.11 per kWh in their transmission charges, including tax and miscellaneous charges, lessened to a total of P0.35 per kWh to be reflected in their billing statements.
However, the Feed-in-Tariff Allowance (FiT-All) will also be effective this billing month with a charge of P0.1830 per kWh as per the ERC’s grant on the increase of P0.0590 per kWh added to the previous rate.
Under the Renewable Energy Act of 2008, the FiT-All is a mandatory additional rate charged to customers to jumpstart the development of renewable energy projects such as wind, run-of-river hydropower, solar and biomass facilities.