September 14, 2014

MER’s pass-through charges lower by P0.58/kWh in September

As reported in variousnews agencies, Manila Electric Co’s (MER) generation charge fell by P0.44/kWh in September to PHP5.19/kWh from P5.63/kWh the previous month. Other bill components such as taxes, transmission, and subsidies and system loss charge were also lower by P0.08/kWh, P0.04/kWh, and P0.02/kWh, respectively, thereby bringing this month’s total reduction in pass-through charges to P0.58/kWh.

According to MER, the reduction in the generation charge was driven by the improved availability of generation plants as less forced outages were registered during the supply month.The cost of power from MER’s power supply agreements (PSA) and independent power producers (IPPs) went down by P0.27/kWh and P0.06/kWh, respectively. Prices in the Wholesale Electricity Spot Market (WESM) were also lower by P5.34/kWh.

Bulk of power was sourced from PSAs and IPPs at 52% and 47%, respectively, while 1% came from the WESM. The rate reduction will have no impact on Meralco’s margins with the savings accruing directly to consumers via lower electricity rates. - WealthSec