The Manila Electric Company (MERALCO) said that its customers continue to enjoy lower power rates in the first three months of the year, as average retail rates dropped by Php0.29 per kilowatt-hour (kWh) compared to the same period last year.
Meralco First Vice President and Head of Regulatory Management Atty. Jose Ronald Valles said the average retail rate amounted to Php7.82 per kilowatt-hour (kWh) in the first quarter from Php8.11/kWh during the same period last year.
“The decrease in retail rates was attributed to a 5.6% decrease in generation charge owing to the implementation of new power supply agreements in February, [and] lower WESM (Wholesale Electricity Spot Market) and fuel prices and the peso appreciation,” Valles said in a statement.
Lower generation and transmission cost and the systems loss over/under-recovery rate (SLOUR) refund approved by the Energy Regulatory Commission (ERC) resulted in a 21% reduction in system loss charge.
The FIT-Allowance recorded a nine-percent drop resulting in lower the FIT-All rate since January 2021 compared to the same period last year. Transmission charge posted a 0.5% decrease in transmission charges due to the transmission over/under recovery (TOUR) implemented since the start of the year, as approved by the Energy Regulatory Commission (ERC).
MERALCO, however saw a 7.1% uptick in distribution charge to Php1.54/kWh owing to the shift in customer consumption due to quarantine protocols implemented during the COVID-19 pandemic. Residential sales went up, while non-residential operated at lower load factors, which led to higher residential sales share in the first three months compared to the same period last year.
Valles explained that with residential distribution rate higher than compared for other customers, higher residential sales results in a higher overall average rate.
“While we continue to work to keep the lights on, we are also cognizant of the challenges our ‘kababayan’ face during these trying time. Thus, we continue to find ways of providing electricity at the least possible cost to our customers,” said MERALCO Vice President and Corporate Communications Head Joe Zaldarriaga.
Power costs in Metro Manila – which tracked its lowest level in March – significantly contributed to the easing of inflation rate in the National Capital Region. The Philippine Statistics Authority shared that inflation rate in the region dropped 3.7% in March from 4.1% in February, as the annual increments for electricity, gas, housing, water and other fuel groups dropped to 0.3% from 0.9% in the same period last year.
In 2020, the average retail rate amounted to Php7.96/kWh, a ten percent drop from Php8.87/kWh in 2019. Based on data from the ERC, MERALCO’s retail rate last year was the 77th highest compared to its peers. It was followed by Aboitiz Power Corporation’s Davao Light and Power Company, which registered Php7.86/kWh.