The Manila Electric Company (MERALCO) has announced an increase of Php 0.5738 per kWh in the February electricity rate, pushing the overall rate to Php 11.9168 per kWh from last month’s Php 11.3430 per kWh, affecting a typical household.
The increase is primarily driven by the generation charge, increasing by Php 0.4552 to Php 7.1020 per kWh from the previous Php 6.6468 per kWh.
Independent Power Producers (IPPs) and Power Supply Agreements (PSAs) contributed to this price increase, with IPP charges rising due to higher fuel costs from First Gas – Sta. Rita and San Lorenzo plants, mainly due to increased use of more expensive imported liquefied natural gas (LNG).
The devaluation of the Peso also added to the rise in IPP charges, which are predominantly dollar-denominated.
PSA charges increased slightly by Php 0.1558 per kWh due to higher charges from Emergency PSAs and Peso depreciation. However, higher excess energy deliveries from some PSAs, priced at a discount, mitigated a further increase.
IPPs and PSAs accounted for 32.8% and 46.8%, respectively, of MERALCO’s total energy requirement in the last supply month. The increase in IPP and PSA charges was partially offset by a Php 0.4071 per kWh decrease in charges from the Wholesale Electricity Spot Market (WESM) due to an improved supply situation in the Luzon grid.
Transmission and other charges saw a net increase of 0.1186 per kWh, reflecting the collection resumption of the Php 0.0364 per kWh Feed-In Tariff Allowance (FIT-All) starting this February billing month.