Saturday, December 7, 2013

Meralco eyes staggered rate hike

Manila Standard Today
By Jenniffer B. Austria | Dec. 07, 2013 at 12:01am

HONG KONG—Power distributor Manila Electric Co. said Friday it is willing to implement the big power rate hike in tranches to cushion the impact on customers.

Meralco president Oscar Reyes said in a news briefing the generation charge should increase by P3.4397 per kilowatt-hour, instead of the previous estimate of P2 to P2.50 per kWh, as a result of the maintenance shutdown of the Malampaya natural gas platform and the outage of several power plants.

“We will probably do it in tranches to cushion the impact and make the second tranche during a month when prices are slightly low which is likely in January. The February billing should normalize and should be an appropriate time to implement the balance,” Reyes said.

Reyes said the company was in talks with government authorities to discuss the extent of adjustments that could be implemented to lessen the impact of the rate increase on the customers.

The increase would bring the generation charge to P9.1 per kWh in December from P5.66 per kWh in November.

Energy Secretary Carlos Jericho Petilla confirmed Meralco had initiated talks with the Energy Regulatory Commission to implement the rate increase in tranches. “We’re talking to Meralco if they can stagger this but this will only be with the approval of the ERC,” Petilla said.

ERC executive director Francis Saturnino Juan said the regulator would look into the proposal of Meralco.

“The ERC will be deliberating on Meralco’s generation charge and its proposed staggering of its recovery of its generation cost incurred in order to reduce the generation charge increase for December,” Juan said.

Petilla said the adjustment was expected to be around P3 per kwh, which would translate into an increase of P600 for power consumers with a monthly consumption of 200 kWh per month.

“At least P3 and this is only during the Malampaya shutdown,” he said.

Petilla said he wanted the increase to be around P1 per kWh, which should be implemented in three months.

“[We’re looking at] the least possible impact to consumers and to Meralco who will be advancing the money,” Petilla said.

Petilla said the P3 per kWh increase came mostly from the bilateral contracts of Meralco, which were affected by the tight supply arising from the Malampaya gas platform shutdown and the outage of several plants.

The Malampaya gas platform, which supplies natural gas to three power plants with a capacity of 2,700 MW, went on maintenance shutdown on Nov. 11 until Dec. 10.   source

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