Manila Electric Co. (Meralco) slashed its rates in electricity bills for May due to lower charges from the spot market and independent power producers (IPPs).
In a briefing on Tuesday, May 13, Meralco said the overall rate declined by ₱0.7499 per kilowatt-hour (kWh), bringing the cost down to ₱12.2628/kWh from ₱13.0127/kWh in April.
The adjustment translates to real savings for households covered by Meralco. Customers using 200 kWh will see ₱150 off their monthly bill. Those consuming 300 kWh, 400 kWh, and 500 kWh can expect reductions of ₱225, ₱300, and ₱375, respectively.
“The rate reduction is driven mainly by lower generation and transmission charges,” said Meralco Vice President Joe Zaldarriaga.
Generation charges fell by ₱0.3144 per kWh, largely due to cheaper prices at the Wholesale Electricity Spot Market (WESM), where rates dropped by ₱1.1424 per kWh.
Improved supply conditions in the Luzon grid helped temper price spikes, despite a 1,372-megawatt rise in peak demand. Grid outages also eased, with unavailable capacity dropping by 1,475 MW.
IPP costs were also down ₱0.9555 per kWh, as dispatch levels improved and the peso strengthened to its highest level since December 2023. Nearly 97% of IPP costs are dollar-denominated, making exchange rates a major factor.
The lower generation charges helped cushion a ₱0.1884 per kWh increase in Power Supply Agreement (PSA) costs, which rose due to lower output. The firmer peso helped blunt the impact on roughly 56% of PSA costs tied to the dollar.
For the April supply period, Meralco sourced 41% of its power from PSAs, 33% from IPPs, and 26% from the WESM.
Transmission charges to households dropped by ₱0.2970 per kWh, following lower ancillary service costs and the removal of adjustments tied to NGCP’s reserve market collections for February and March.
Other line items — including taxes and universal charges — posted a combined decrease of ₱0.1385 per kWh.
Meralco clarified that these are pass-through costs paid to generators, the grid operator, and the government. Its distribution charge has remained unchanged since a ₱0.0360 per kWh cut in August 2022. Customers also continue to benefit from a ₱0.2024 per kWh refund under a distribution-related true-up. (TCSP)
