Power rates of Manila Electric Co. will likely go down in January due to lower demand amid cooler temperatures and the reconciliation of the outage allowance of the generators.
“Hopefully there will be another reduction in January… If we will use historical records as basis, normally rates are lower in January,” Meralco spokesman Joe Zaldarriaga said.
He said the less outages also contributed to the lower rates of P0.3785 per kilowatt-hour charged to consumers in December.
“The reason why power rates were lower in December is because there were less outages aside from the strengthening of the peso,” he said.
Meralco head of utility economics Lawrence Fernandez attributed the anticipated drops in rates to the reduction in capacity fees arising from the annual reconciliation of outage allowances done at the end of each year under the contracts approved by the Energy Regulatory Commission.
Meralco’s power rates declined in December due to lower generation charges amid a stronger peso and lower prices at the spot market.
The overall rate of a typical Meralco household dropped to P9.2487 per kWh from last month’s P9.6272 per kWh.
“The lower December rate is mainly due to a P0.3035 per kWh reduction in the generation charge,” Meralco said earlier.
Meralco said the generation charge fell to P4.6045 per kWh this month from P4.9080 per kWh in November primarily due to the peso’s appreciation and lower Wholesale Electricity Spot Market charges.
Charges from the WESM decreased P0.4658 per kWh despite a slight increase in the demand for power in Luzon.
Meralco said the power supply situation improved from October, when the grid experienced three instances of yellow alerts due to thin reserves.
Meralco obtained 12 percent of its power requirements from the WESM in December.
Charges from independent power producers and power supply agreements also registered a decline of P0.2191 per kWh and P0.3244 per kWh, respectively, mainly due to the strengthening of the peso against the US dollar.
Meralco said the peso-dollar exchange rate affected around 97 percent of IPP and 60 percent of PSA charges. Meralco secured an equal 44 percent of its requirements from IPPs and PSAs.
The transmission charge of residential customers fell P0.0186 per kWh due to lower wheeling and ancillary charges.