The Manila Electric Company (Meralco) announced today an upward adjustment of P0.1520 per kilowatt-hour (kWh) in the November electricity rate, reversing the downward trend from the previous month. The overall rate for a typical household has increased to P13.4702 per kWh from October’s P13.3182 per kWh.
For residential customers consuming 200 kWh monthly, this adjustment translates to an approximate increase of P30 in their total electricity bill.
Primary Drivers: Transmission and FIT-All Charges Spike
The overall increase is primarily attributed to two key components: the transmission charge and the Feed-in Tariff Allowance (FIT-All).
The transmission charge for residential customers saw a significant jump of P0.1468 per kWh. Meralco cited higher ancillary service charges from the Reserve Market incurred by the National Grid Corporation of the Philippines (NGCP) as the reason for this increase. Ancillary services are essential for maintaining the stability and reliability of the power grid.
Simultaneously, the Feed-in Tariff Allowance (FIT-All) increased by P0.0884 per kWh. This follows a directive from the Energy Regulatory Commission (ERC) for collecting agents to implement a new FIT-All rate of P0.2073 per kWh, effective this November, up from the previous rate of P0.1189 per kWh. The FIT-All is a pass-through charge that subsidizes renewable energy producers, such as those generating power from wind, solar, and run-of-river hydro.
Generation Charge Provides Cushion Against Larger Hike
Mitigating what would have been a steeper increase was a decrease in the generation charge, which fell by P0.1008 per kWh to P7.9000 from P8.0008 in October. This component, the largest in the electricity bill, reflects the cost of power Meralco procures from its suppliers.
The reduction was driven by lower costs from two main sources:
- Power Supply Agreements (PSAs): Rates decreased by P0.2985 per kWh, primarily due to a reduction in fuel costs. This decline was substantial enough to more than offset the negative impact of the Philippine Peso’s depreciation against the US Dollar.
- Wholesale Electricity Spot Market (WESM): Charges went down by P0.6273 per kWh. This decrease occurred despite tighter supply conditions in Luzon during October and is attributed to downward adjustments made to the final WESM bill.
However, charges from Independent Power Producers (IPPs) increased by P0.2481 per kWh. This was almost entirely due to the depreciation of the Peso, as approximately 99% of IPP costs are US dollar-denominated.
For the current period, Meralco’s energy supply mix was composed of 77% from PSAs, 20% from IPPs, and 3% from WESM.
Clarification on Bill Components and Customer Assistance
Meralco clarified that pass-through charges, such as those for generation and transmission, are collected and paid directly to power suppliers and the NGCP, respectively. Similarly, taxes, universal charges, and the FIT-All are remitted to the government.
The company emphasized that its distribution charge—the component retained by Meralco for its operations—has remained unchanged since it was reduced by P0.0360 per kWh in August 2022.
Customers experiencing power outages or with other concerns are encouraged to contact Meralco through its official social media accounts on Facebook (www.facebook.com/meralco) and Twitter (@meralco). They may also text 0920-9716211 or 0917-5516211, or call the Meralco Hotline at 16211.
The Manila Electric Company is the Philippines’ largest distribution utility, providing service to millions of customers in its franchise area, which includes Metro Manila and parts of surrounding provinces.#
