Manila Electric power bills reduced in May

Meralco reduced its generation charge by US 0.0126 cents from US 0.1057 cents per kWh last April to US 0.0931 cents per kWh this month. This translates to cheaper electricity bills for Manila Electric Company or Meralco consumers this May.

"The generation cost of Meralco's suppliers reflected a significant decrease, mainly triggered by a considerable reduction in fuel cost last April," said Meralco VP and head of Utility Economics Ivanna dela Peña.

Under the quarterly repricing, the price of natural gas used by the First Gas plants declined by 30 percent, from US$10.69 per Gigajoule to US$7.46 per Gigajoule for the April 2009 supply month. Because of this, both First Gas-operated Sta. Rita and San Lorenzo experienced reductions. Sta. Rita, which contributed 28.9 percent in Meralco's energy share, had a US 0.0368 cents per kWh reduction, while San Lorenzo, at 14.6 percent energy share, had a reduction of US 0.0234 cents per kWh.

Meanwhile, Meralco's other independent power producer (IPP), Quezon Power, which supplied 12.8 percent of Meralco's requirement, had a decrease of US 0.0149 cents, due to improved dispatch. The average NPC rate also went down by US 0.0041 cents. NPC accounted for 36.4 percent of Meralco's energy requirements.

All these reductions tempered the US 0.0299 cents per kWh increase in the price of WESM, which supplied 7.4 percent of Meralco's requirement.

Aside from the reduction in the generation charge, Meralco will also be adjusting other electric bill components for the May 2009 billing month.

Recently, the Energy Regulatory Commission (ERC) approved Meralco's pending application to adjust distribution-related charges. At the same time, the regulatory body directed Meralco to accelerate the CERA refund, from US 0.008 cents per kWh that was implemented in March to US 0.0031 cents per kWh this May.

In addition, transmission charges to customers will go down by an average of US 0.0035 cents per kWh through the annual updating of transmission charges as provided by ERC's Transmission Rate Adjustment Mechanism (TRAM). System loss charges will also drop following reduced generation and transmission charges.

Considering all of these adjustments, Meralco customers will experience net reductions in their bills this May. A residential customer consuming 100 kwhs who paid US$15.45 in April will see his May bill go down by US$1.21. An average Meralco residential customer consuming 200 kWh per month will experience a reduction of US$3.47.