Customers of Manila Electric Co. will experience lower power rates in May as the overall rate for a typical household dropped P0.2483 per kilowatt-hour to P8.7468 per kWh from P8.9951 per kWh in April.
The lower rate is equivalent to a reduction of around P50 in the total bill of residential customers consuming an average of 200 kWh a month.
Meralco attributed the reduced rates to lower generation charges as the company claimed force majeure from its power supply agreements amid low demand due to the enhanced community quarantine.
The generation charge declined P0.2537 per kWh to P4.3848 per kWh from P4.6385 per kWh in April.
“Because of the very significant reduction in power demand in its service area during the ECQ (enhanced community quarantine) period, Meralco invoked the force majeure provision in its power supply agreements (PSAs) for the duration of the lockdown, reducing fixed charges for generation capacity that would have been charged by suppliers,” the company said.
Meralco said the force majeure claim totaled P877 million in May, equivalent to savings of P0.3452 per kWh, representing reduction in fixed costs, and avoided charges from the temporary suspension of the mid-merit supply contracts recently approved by the Energy Regulatory Commission.
The generation charge in April reflected a P129-million reduction in fixed costs due to Meralco’s force majeure claim.
The reduction due to force majeure claim combined with lower fixed costs totaled over P1 billion.
Meralco said charges from the PSA dropped P0.2116 per kWh mainly due to the force majeure claim, while cost of power from independent power producers also decreased by P0.6418 per kWh due to higher average plant dispatch, lower fuel prices and peso appreciation.
PSAs and IPPs accounted for 52 percent and 46 percent of Meralco’s total supply, respectively.
Meanwhile, charges from the Wholesale Electricity Spot Market, the country’s electricity spot market, increased P1.8502 per kWh due to the included line rentals related to Meralco’s supply contracts.
Meralco bought less than two percent of its power needs from the WESM.
The company said there was no movement in the feed-in-tariff allowance (FIT-All) for May as the ERC ordered another month of deferral of the FIT-All in consideration of the current ECQ.