THE Manila Electric Company (Meralco) yesterday announced a significant reduction of almost one peso or P0.9879 per kWh in the April electricity rate, bringing the overall rate for a typical household down to P10.9518 per kWh from P11.9397 per kWh in March.

For residential customers consuming 200 kWh, the adjustment is equivalent to a decrease of around P198 in their total electricity bill.

The substantial reduction in the overall electricity rate this month wiped out rate increases since January 2024, bringing the year-to-date adjustment to a net decrease of P0.3066 per kWh.

Both generation and transmission charges registered sharp decreases this month.

The generation charge had a reduction of P0.3613 per kWh owing to lower costs from Independent Power Producers (IPPs) and Power Supply Agreements (PSAs) that offset the increase in Wholesale Electricity Spot Market (WESM) charges.

Similarly, charges from PSAs decreased by P0.5733 per kWh mainly due to lower fuel costs of South Premier Power Corp. (SPPC) under the emergency PSAs with Meralco, as well as that of San Buenaventura Power Ltd. (SBPL).

On the other hand, charges from the WESM increased by P1.0114 per kWh due to tighter supply conditions in the Luzon grid. Average demand went up by 618 MW while average capacity on outage also increased by 473 MW. The secondary price cap was applied around seven percent of the time, indicating periods of sustained high prices in the WESM.

The transmission charge, meanwhile, went down by P0.4665 per kWh following the ERC’s suspension of settlements in the Reserve Market that drove the significant increase in ancillary service charges in the March electricity rates.

“The significant reduction in this month’s overall electricity rate more than wiped out the increases in power rates for the first quarter of the year. Despite the rate reduction, Meralco continues to encourage its customers to continue practicing energy efficiency especially during summer when consumption historically increases anywhere from 10 to 40% due to warmer temperatures,” Meralco vice president and head of Corporate Communications Joe R. Zaldarriaga said.

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Arlene Rivera