Meralco generation rates to go up
Friday, January 05, 2007
By MYRNA M. VELASCO
The Energy Regulatory Commission (ERC) approved an increase of P0.2614 per kilowatt hour (kWh) in the generation charge of giant utility firm Manila Electric Company (Meralco) to be billed to its customers starting this month.
The rate adjustment accounts for the more expensive power supply the utility firm purchased, primarily those from the Wholesale Electricity Spot Market (WESM) for the month of October last year.
The other component with prescribed rate adjustments is on system loss recovery application of the utility firm.
The ERC ruling indicated that the generation charge of Meralco for January 2007 billing cycle would be P4.6904 per kWh as compared to existing generation charge of P4.4290 per kWh.
The utility firm has been directed to reflect the differential amount as a separate item in its bill using the phrases: "Differential Amount for October 2006 Generation Charge" and "Differential Amount for October 2006 System Loss Charge."
The regulatory body said the new generation charges will be effective in this month’s billing; and the differential amount will be applied only to the kWh consumption of the customers for the October 2006 billing period.
Previous reports indicated that Meralco originally sought for P1.30 per kWh adjustment in its generation charge due to spikes in WESM prices.
However, due to the decision of the Philippine Electricity Market Corporation (PEMC) to bring down prices closer to the level of the spot market’s second month of commercial operation, the utility firm was prompted to revise its application for generation charge adjustment.
The ERC stipulated that Meralco prayed to hike its generation charge to P5.7334 per kWh, to include deferred accounting adjustments (DAA) covering the billing periods from February 2005 to January 2007; but the regulator disallowed pass on of some costs.
The generation charge component in the electricity rates billed to consumers is a pass-through, which means that Meralco will just collect the amount but these will be remitted to its power suppliers, such as the National Power Corporation, WESM and the independent power producers.
Meanwhile, the ERC prescribed that the allowable system loss as applied for by Meralco shall be calculated on a per customer class level, as backed by documentary evidence lodged by the applicant utility firm.
The estimated system loss charges for residential and general service customers have been set at P0.7682 per kWh. Meanwhile, those for industrial customers would range from P0.1037 to P0.7682 per kWh.
In October, it was shown from documents that the bulk of supply procured by Meralco was from its contracted IPPs with 52.7-percent share; followed by WESM for 46.5percent chunk and the rest from the One-Day Power Sales (ODPS) scheme of NPC for 0.7-percent.
In its verdict, the Commission noted that it required Meralco to comply with all rules set for applications for rate adjustment, primarily the requirement for publication which was a core policy established due to an earlier ruling of the Supreme Court. (MMV)
posted by philpower @ 7:20 AM,
