Repricing of Malampaya Gas may ease seen MERALCO rate hike

meralco malampaya

The scheduled Malampaya gas repricing of the contracted power capacity being delivered to the Manila Electric Co. (MERALCO) may temper its projected increase in electricity bills for the month of February. 

In a report by the Manila Bulletin, MERALCO vice president and spokesperson Joe Zaldarriaga said that the direction on the overall pass-on rates remains unclear, as the earlier projected price increase may be offset by the scheduled gas repricing and the softer prices in the Wholesale Electricity Spot Market (WESM). 

Zaldarriaga added that there is an “upward pressure on the electricity rates this month.” They, however, have yet to receive all final billings from suppliers. 

MERALCO is expecting lower natural gas prices following Malampaya’s quarterly repricing to “further help temper any increase in other bill components.” 

Earlier, MERALCO said that its customers may face a Php 0.7897 per kilowatt-hour increase in electricity rates following the two-week maintenance shutdown of the Malampaya this February. 

Zaldarriaga added that the predicted increase factors in the completion of a distribution-related refund of around Php 0.19/kWh for residential customers. The MERALCO official is optimistic that this can be “mitigated by lower WESM prices given the improved Luzon Grid situation following lower demand and fewer power plants on outage, as well as the absence of yellow alert in the last supply month.”

The Malampaya is currently undergoing maintenance shutdown from February 4 to February 18, 2023. 

The Department of Energy said that they are targeting a “no rate hike” scenario after the two-week shutdown.