Power retailer Manila Electric Co. announced Wednesday a reduction of P0.2908 per kilowatt-hour in August rates, the second consecutive month of price reduction.
Meralco said the overall rate for a typical household went down to P10.8991 per kWh this month from P11.1899 per kWh in July.
Meralco head of utility economics Lawrence Fernandez said the high oil prices in the past weeks would have no direct effect as suppliers were not using oil for power generation.
The combined reduction over the past two months now reached P1.0121 per kWh.
Meralco attributed the overall rate decrease to lower generation charge, which registered its third consecutive reduction. It went down by P0.2137 to P6.3929 per kWh from P6.6066 per kWh in July.
Charges from the Wholesale Electricity Spot Market dropped P1.2873 per kWh as average demand in the Luzon grid fell by more than 200 MW with the onset of the rainy season.
The decrease in spot market prices also reduced the imposition of the secondary price cap.
Meralco sourced around 17 percent of its energy requirement from WESM during the period.
Charges from power supply agreements also went down by P0.1688 per kWh due to lower fuel prices and the peso’s appreciation which affected around 26 percent of PSA charges that are dollar-denominated.
The reductions in WESM and PSA charges offset a slight P0.0853 per kWh increase in charges from independent power producers, due to lower average IPP dispatch as several units of First Gas-Sta Rita and First Gas-San Lorenzo underwent scheduled outage during the July supply month.
Meralco said the decrease in the price of Malampaya natural gas following its quarterly repricing and the peso appreciation affected around 97 percent of dollar-denominated IPP charges.
PSAs accounted for 47 percent of Meralco’s total energy requirement, while IPPs covered the remaining 36 percent.
Transmission and other charges, which include taxes and subsidies, also registered a net reduction of P0.0771.
Meralco’s distribution charge has not moved since August 2022.