Power rates in the franchise area of Manila Electric Co. will drop P0.5260 per kilowatt-hour in January, translating into a P105 reduction in the monthly bill of a typical household consuming 200 kilowatt-hours.
Meralco said in a statement the overall rates would decline to P8.7227 per kWh in January from P9.2487 per kWh in December.
“The lower January rate is mainly due to a P0.5277 per kWh reduction in the generation charge,” the country’s biggest power retailer said.
This marked the second consecutive month that power rates declined, bringing the total reduction to P0.9045 per kWh in the two-month span.
Generation charges declined to P4.0768 per kWh in January from P4.6045 per kWh in December on lower rates covered by power supply agreements and lower Wholesale Electricity Spot Market charges.
Charges from Meralco’s power supply agreements registered a decrease of P0.9810 per kWh brought about by a reduction in capacity fees as a result of the annual reconciliation of outage allowances done at the end of each year under the PSAs approved by the Energy Regulatory Commission.
Meralco said the reduction in capacity fees of generator companies were also passed on to consumers by way of lower electricity rates.
Meralco, however, said the capacity fees from PSAs would return to normal levels after the downward adjustment this month.
The company sourced 40 percent of its power requirements from PSAs in December.
Charges from WESM, the country’s trading floor of electricity also decreased P1.6943 per kWh on lower spot prices resulting from a reduction in power demand in the Luzon grid.
Meralco sourced 19 percent from WESM during the last supply month.
Charges from Meralco’s independent power producers, however, increased P0.3808 per kWh because of lower average plant dispatch.
Meralco purchased 41 percent of its total requirements from the IPPs.
Transmission charges of residential customers also increased by P0.1168 per kWh on higher ancillary service charges of National Grid Corp. of the Philippines, but this was offset by lower taxes and other charges.
Meralco’s distribution, supply and metering charges were unchanged. Meralcoh has more than six million customers in its franchise area.