MANILA, Philippines—Customers of Manila Electric Co. should gear for higher electricity bills this month as the generation charge rose by 20.13 centavos a kilowatt-hour (kWh) to P5.0474 per kWh in April.
The increase means that households consuming about 100 kWh a month have to pay P20.13 more this month, while those consuming 200 kWh will have to bear with a P40.26-increase in their monthly bills. Households consuming 300 kWh can expect a P60.39-jump in their April bills.
Still, this month’s generation charge was less compared to that of April 2010, when it rose to P6.7699 per kWh, Meralco said in a statement.
Meralco explained that the actual costs of electricity obtained from two of its suppliers namely the wholesale electricity spot market (WESM) and its independent power producers (IPPs) actually declined.
However, the Philippine Electricity Market Corp., operator of the WESM, made some billing adjustments to Meralco to reflect the costs incurred by the so-called “must-run units” last May 2010.
When a facility has been declared as a "must run unit," it will have to operate and charge according to prevailing spot market prices. Should these prices prove to be less than the true cost of operating the facility at that time, the power generation firm can recover these costs later on.
Meralco secured only 2.5 percent of its electricity requirements from WESM; 47 percent from the state-run National Power Corp.; and 50.4 percent from the IPPs, which have been the company’s cheapest source of electricity.
The distribution utility buys from three IPPs—Quezon Power Philippines Ltd.’s coal-fired facility, the 1,000-megawatt Sta. Rita and the 500-MW San Lorenzo natural gas-fired power plants, which are both owned by the Lopez-led First Gas Holdings.
Meralco reported that the rates of these IPPs have gone down by 2.4 centavos per kWh, while the cost of power from Napocor rose slightly by only 1 centavo per kWh.
Meralco reiterated that the generation charge was entirely a pass-through charge and did not accrue or go to Meralco. The cost of electricity sold by the generating companies could move from month to month based on many factors beyond its control, among them fuel prices, the dispatch of the IPPs, the foreign exchange rate and WESM prices.
The generation charge, which is the electricity bill’s biggest component, usually averages about 60 percent of the customer’s average monthly power bill. This goes directly to Meralco’s power suppliers.
Meralco have advised its customers to prepare for the coming summer months as power prices historically increase during this time.
Power consumption also tends to shoot up during the summer months as households use cooling appliances longer and more people use these appliances, to ease the warm weather conditions during the summer break.
The power company also advised its customers to observe energy efficiency tips during this time of the year including opening the refrigerator only when needed; unplugging unused appliances; and ironing clothes in bulk among others.
The increase means that households consuming about 100 kWh a month have to pay P20.13 more this month, while those consuming 200 kWh will have to bear with a P40.26-increase in their monthly bills. Households consuming 300 kWh can expect a P60.39-jump in their April bills.
Still, this month’s generation charge was less compared to that of April 2010, when it rose to P6.7699 per kWh, Meralco said in a statement.
Meralco explained that the actual costs of electricity obtained from two of its suppliers namely the wholesale electricity spot market (WESM) and its independent power producers (IPPs) actually declined.
However, the Philippine Electricity Market Corp., operator of the WESM, made some billing adjustments to Meralco to reflect the costs incurred by the so-called “must-run units” last May 2010.
When a facility has been declared as a "must run unit," it will have to operate and charge according to prevailing spot market prices. Should these prices prove to be less than the true cost of operating the facility at that time, the power generation firm can recover these costs later on.
Meralco secured only 2.5 percent of its electricity requirements from WESM; 47 percent from the state-run National Power Corp.; and 50.4 percent from the IPPs, which have been the company’s cheapest source of electricity.
The distribution utility buys from three IPPs—Quezon Power Philippines Ltd.’s coal-fired facility, the 1,000-megawatt Sta. Rita and the 500-MW San Lorenzo natural gas-fired power plants, which are both owned by the Lopez-led First Gas Holdings.
Meralco reported that the rates of these IPPs have gone down by 2.4 centavos per kWh, while the cost of power from Napocor rose slightly by only 1 centavo per kWh.
Meralco reiterated that the generation charge was entirely a pass-through charge and did not accrue or go to Meralco. The cost of electricity sold by the generating companies could move from month to month based on many factors beyond its control, among them fuel prices, the dispatch of the IPPs, the foreign exchange rate and WESM prices.
The generation charge, which is the electricity bill’s biggest component, usually averages about 60 percent of the customer’s average monthly power bill. This goes directly to Meralco’s power suppliers.
Meralco have advised its customers to prepare for the coming summer months as power prices historically increase during this time.
Power consumption also tends to shoot up during the summer months as households use cooling appliances longer and more people use these appliances, to ease the warm weather conditions during the summer break.
The power company also advised its customers to observe energy efficiency tips during this time of the year including opening the refrigerator only when needed; unplugging unused appliances; and ironing clothes in bulk among others.
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