Meralco to reduce electricity rates this month

Households can expect a reduction in the cost of electricity in January as Manila Electric Co. (Meralco), the country’s biggest distribution utility, announced on Wednesday it will lower rates by Php0.5260 per kilowatt-hour (kWh).

This brings the overall rate to Php8.7227 per kWh from Php9.2487 per kWh previously. A typical residential customer with a 200-kWh consumption will see their monthly bill reduced to around Php105.

Households consuming 300 kWh, 400 kWh and 500 kWh will see a reduction of Php157.8, Php210.4 and Php263, respectively, in their monthly bills. “The lower January rate is mainly due to a Php0.5277 per kWh reduction in the generation charge,” Meralco said in a statement.

The reduction is the second straight month of decrease in overall electricity rates, the company said, placing the total reduction at Php0.9045 per kWh during the two-month period.

Meralco said lower power supply agreements (PSAs) as well as lower charges at the wholesale electricity spot market (WESM) largely contributed to the drop in the generation charge to Php4.0768 per kWh in January from Php4.6045 per kWh in December.

Charges from the supply contracts were down by Php0.9810 per kWh, the company said. “The lower PSA charges were brought about by a reduction in capacity fees as a result of the annual reconciliation of outage allowances done at the end of each year under the PSAs approved by the Energy Regulatory Commission (ERC),” it said.