Higher generation rate causes electricity rate hike

Davao Light photo
Davao Light photo

As anticipated, the current power situation in Mindanao has affected the generation charges. One of the factors that has a significant impact on the electricity rate is the El Niño phenomenon which affected the hydropower sources, reducing their generating capacity to as low as 50% and resulting in a low supply of cheaper power. 

The higher power supply prices from the Philippine Wholesale Electricity Spot Market (WESM) in Mindanao is another driver of the increase in Davao Light and Power Co., Inc. (Davao Light) residential rate by P1.6254 per kilowatt hour (kWh) this month of May.

The higher generation charges pulled the overall residential rate up to P10.7608 per kWh from the previous month's P9.1354 per kWh where a typical household with an average monthly consumption of 200 kWh will experience a P325.08 increase compared to their April billing. This rate applies to the billing period of May 11 to June 10, 2024.

“We emphasize that the increase is driven by the generation charge which is a pass-through charge that Davao Light merely collects and pays to generation companies,” said Fermin Edillon, Reputation Enhancement Department Head. Edillon explained that power rates are divided into four major components: Generation and Transmission, Distribution, Subsidies and Other Charges, and Government Charges and Taxes. 

Furthermore, Davao Light's distribution rate approved by the Energy Regulatory Commission (ERC) has remained unchanged since 2013. 

Earlier this month, the power utility advised customers to conserve electricity as rate increases are expected in the next few months given the power supply situation and high demand due to the warm and dry season.

With this, Davao Light reminds customers to manage their energy consumption properly to avoid high bills. Households can save electricity by lessening the hours or days used for appliances with high wattage ratings and using energy-efficient appliances and lighting fixtures. Moreover, on hot and warm days it is best to keep the house cool by opening windows and curtains to allow air to flow freely.

Davao Light customers can check the power utility’s official Facebook page DavaoLightOfficial for more energy conservation tips, andwww.davaolight.com for the complete monthly rates.

Davao Light, an AboitizPower subsidiary, is the country’s third largest privately-owned electric distribution utility, in terms of customer size and annual kWh sales. Its franchise area covers the cities of Davao and Panabo and the municipalities of Carmen, Dujali, and Sto. Tomas in Davao del Norte, with a population of approximately 2.23 million and a total area of 3,561 sq. km. PR

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