Stronger peso seen to cut Meralco rates in Sept.

POWER DISTRIBUTOR Manila Electrie Co. (Meralco) expects a lower overall rate this month, as a stronger peso is seen to have brought down the cost of power purchased from its suppliers.

- By Sheldeen Joy Talavera

“We expect lower generation charge to pull down the overall rate this September,” Meralco Vice-President and Head of Corporate Communications Joe R. Zaldarriaga said ina statement on Tuesday.

The potential easing in the generation charge was triggered by peso appreciation, affecting costs of Meralco’s suppliers that are dollar-denominated, he said.

The peso closed at P57.13 per dollar on Aug. 29, strengthening by nearly P1.19 from its P58.32 finish on July 31, according to the Bankers Association of the Philippines’ reference exchange rate.

The generation charge typically accounts for more than 50% of the monthly electricity bill.

Mr. Zaldarriaga said the potential reduction in the generation charge is projected to more than compensate for the cost recovery claims filed by San Miguel Global Power Holdings Corp. (SMGP) for its terminated contracts.

The Energy Regulatory Commission (ERC) earlier allowed South Premiere Power Corp. (SPPC) and Sual Power, Inc. (SPI) (formerly San Miguel Energy Corp.) to collect P5.1 billion in total cost recoveries, to be implemented over a six-month period starting in September.