The Manila Electric Company (Meralco) announced a minor reduction in electricity rates for September, dropping to P14.7424 per kilowatt-hour (kWh) from P14.7833 the previous month.
This decrease translates to approximately P8 in savings for a household consuming 200 kWh. However, the utility has faced rising generation costs, which limit these savings.
Increased Generation Costs Amid Economic Pressures
Despite the reduction in overall rates, Meralco reported an increase in generation charges, which rose by P0.4232 per kWh. This surge is primarily attributed to a weaker peso and elevated fuel prices, exacerbated by ongoing geopolitical tensions in the Middle East.
The increase in generation cost is significant, yet we have managed to provide some relief through other adjustments.
Meralco Spokesperson
Meralco indicated that the decline in ancillary service charges, which fell by P0.3344 per kWh, played a crucial role in offsetting the higher generation costs. These adjustments come after the completion of maintenance work at the Malampaya gas facility, allowing for increased use of local natural gas, which is exempt from value-added tax.
Additionally, the utility is continuing to implement two previously approved refunds, amounting to P1.0139 per kWh, which were already reflected in August bills.
This latest decrease marks the second consecutive month that Meralco has lowered its rates, following a previous reduction of P0.0428 per kWh in August.