Thursday, January 08, 2009 Meralco consumers to get rate cut
CUSTOMERS of power retailer Manila Electric Company (Meralco) will still enjoy lower generation charge for the month of January.
Ivanna dela Peña, Meralco’s vice president for utility and economics, said their consumers will experience 7.9 centavo per kilowatthour (kWh) reduction this month as a result of the low prices in the wholesale electricity spot market (WESM) and the use of banked gas.
Generation charge dropped to P4.50 per kWh this month, dela Peña added.
“Very low prices in the WESM and the use of banked gas by the First Gas plants last December were the main drivers for the reduction,” she said.
With the reduction in the generation charge, system loss charges also declined.
For January, residential customer consuming 100 kWhs per month will have an P8 reduction in his bill this January while customers using 200 kWh, they will see their monthly bills go down by P18.80.
The Meralco official explained that the “the sharp decline in cost from these sources cushioned the upward adjustment in the National Power Corporation’s (Napocor) Gram (Generation Rate Adjustment Mechanisms) and Icera (International Currency Exchange Rate Adjustment) ordered by the Energy Regulatory Commission last December and the collection of the P2.11 billion unbilled line congestion cost for July 2008 which was already paid to the PEMC on schedule last August 2008.”
She further said that included in the generation charge computation for January 2009 was the return to customers of the P392 million net settlement surplus (NSS) balance as of November 2008.
Besides the low prices in the spot market and the cheap banked gas prices, dela Peña said that another factor that contributes to the decline in the generation charges is the low demand due to the Christmas holidays and the cold weather.
The First Gas plants, on the other hand, fully ran on banked gas, as compared to the 50 to 60 percent of their fuel consumption in November.
With the end of the Christmas holidays, the prices in the WESM are expected to normalize this January while the natural gas plants are already using contracted gas quantities for 2009 whose prices are indexed to world oil prices of the past six months.
Meralco vice president for corporate communication Elpi Cuna said: “We have always maintained that whatever savings we incur from the cost of power we obtain from our suppliers would be passed on to our customers. The generation charge is a pass-through charge, which Meralco does not earn from.”
Last December, Meralco slashed its generation charge by P0.45 per kWh due to the use of banked gas by First Gas for its two power plants, namely: Sta. Rita and San Lorenzo.
Meralco is getting 51.6 percent of its power requirement to the independent power producer, 38.6 percent from Napocor, and 9.7 percent is being source from the spot market. (MSN/Sunnex)
