STOCK Meralco
Manila Electric Co (Meralco) linemen repair power meters atop electricity post at the port area of Metro Manila, Philippines. Image Credit: Shutterstock

Manila: Electricity bills in Manila are set to rise for the second consecutive month after Meralco, the country's biggest private electric distribution utility, announced a rate hike for June.

12.0575 php

Electricity rate for June 2024 (Source: Meralco)

While the increase is attributed to pass-through charges, Meralco says it was partially offset by deferred generation costs.

Higher generation costs drive increase

The June rate of 12.0575 pesos ($0.21) per kWh reflects a 0.6436 pesos per kWh increase from May's rate. Meralco cites a rise in generation charges, particularly those sourced from the Wholesale Electricity Spot Market (WESM), as the main reason behind the hike.

The company also purchased more power from WESM due to tighter grid supply in Luzon.

The country’s energy mix in 2022 was made up of coal (31 per cent), natural gas (4.2 per cent), renewable energy (32.7 per cent, mainly hydro, geothermal, solar and wind), and oil-based solutions (32.2 per cent).

Meralco said it is looking at nuclear power to replace fossil fuel in the long term as a source of carbon-free energy.

Some relief from deferred charges

While the overall generation charge rose, Meralco negotiated deferrals with some suppliers, reducing the immediate impact on bills.

This deferred amount will be spread out over the next three months.

Customers brace for higher bills

Residential customers consuming 200 kWh can expect their bills to increase by around 129 pesos ($2.20) this month. Meralco is still seeking regulatory approval for an additional power supply agreement that could potentially lower future costs.