Manila Electric Co. on Thursday announced a big power rate reduction in June when it will start refunding overcharges in 2014 to 2016.
Meralco said power rates in residential households would go down by P1.43 per kilowatt-hour this month to P8.17 per kWh from P9.60 per kWh in May.
This would translate into a reduction of P285 in the total bill of a typical residential household consuming 200 kWh.
Meralco said the June rate reflected the refund of P6.9 billion in pass-through charges from January 2014 to December 2016 and lower generation cost.
The Energy Regulatory Commission granted Meralco’s petition for refund with a plea for provisional authority on May 11 for implementation from June to August billing.
“The refund will not be a separate line item in the bill but will be embedded in the different pass-through charges indicated in the bill, which include generation, transmission and system loss charges and lifeline and senior citizen subsidies,” the company said.
For residential customers, the refund would translate into a reduction of P0.79 per kWh, excluding taxes.
Meralco said the downward movement in the generation charge also resulted in lower June rates.
Overall generation charge decreased by P1.0253 per kWh this month, or from P4.8839 per kWh in May to P3.8586 per kWh in June.
Power sourced from independent power producers went down by P0.59 per kWh while power sourced from the Wholesale Electricity Spot Market dropped P1.25 per kWh. Prices of its power supply agreements also declined by P0.04 per kWh.
“There was a reduction in IPP and PSA costs because of higher plant dispatch, continuous peso appreciation and the completion of the staggered recovery of liquid fuel cost that was incurred during the Malampaya maintenance shutdown from Jan. 28 to Feb.16, 2017,” Meralco said.
Meralco sourced 40.7 percent of its power requirements from IPPs in May, followed by PSAs at 45.6 percent and the remaining 13.7 percent from WESM.
“Additionally, the decrease in cost of power supplied through WESM is due to fewer plant outages despite higher power demand in Luzon,” it said.
Transmission charges also went down P0.11 per kWh in the transmission charge of residential customers, while taxes and other charges also went down by a combined amount of P0.35 per kWh.
Meralco, however, said that the higher feed-in-tariff allowance, a line item in the power bill, would be implemented this month.
The Fit-All is now at P0.1830 per kWh, after the ERC recently approved an increase of P0.0590 per kWh on the previous rate.
FIT-All is a pass-through charge remitted to the National Transmission Corp. as an incentive for renewable energy developers, such as those operating wind, run-of-river hydropower, solar and biomass facilities.
Meralco said its distribution, supply, and metering charges remained unchanged for 23 months.