Lower power costs in January

Business World Online
Posted on January 06, 2012 08:04:21 PM


COOLER TEMPERATURES could push the January generation charge down resulting in lower bills for the month, said distribution utility Manila Electric Co. (Meralco) on Friday.
"We’re expecting a slight reduction. It appears that the generation supply situation has normalized, coupled with slightly lower power demand because of cooler December temperatures," Lawrence S. Fernandez, Meralco head for utility economics, said in a text message to reporters.


Costs were down, he added, "mainly be due to lower Wholesale Electricity Spot Market (WESM) prices…."


For December, generation charge was lower by P0.27 per kilowatt-hour (kWh) to P5.51/kWh from P5.79/kWh in November to reflect lower WESM prices.


Meralco also does not expect price movements from independent power producers, Mr. Fernandez said.


"As for the independent power producers, we do not expect major movements in their prices as foreign exchange and fuel costs were relatively stable," he said.


Generation charge, which comprises about 60% of the electricity bill, is considered a pass-through cost and is usually computed using the billing from the previous month.


For the nine month period ending September, Meralco posted a core net income growth of 27.4% to P11.66 billion from P9.15 billion the year previous. Its consolidated reported net income rose 24.9% to P9.95 billion from P7.97 billion.


Shares of Meralco closed at P257, down 1.98% from its previous close of P262.20 a piece. -- Emilia Narni J. David