By Jennifer P. Rendon
After years of paying for one of the most expensive, if not the most exorbitant, power rates in the country, consumers of Iloilo City will see a dramatic plunge in their electricity bills in July 2021.
MORE Electric and Power Corporation announced Thursday a downward rate adjustment of ₱3.5588 per kilowatt-hour (kWh) for residential rates. This means that the more than 82,000 residential consumers will only pay P6.4562 per kWh in July 2021, against P10.0149/kWh in June.
A household consuming an average 300 kwh per month may expect a ₱1,067.64 decrease in its electric bill.
Other consumer types (intermediate, commercial, power, city streetlights, city offices, and other government offices) will enjoy a uniform rate cut of P3.3102/kWh.
MORE Power president Roel Castro attributed the drastic rate cut to the 100 percent connection to the Visayas grid following the expiration of its 1-year emergency power supply contract with Panay Energy Development Corp (PEDC) last May 25.
“The implication of that move is we can now choose the supplier from the spot market to give us the cheapest rate available,” Castro said in a virtual press conference.
He said they could choose from at least 13 qualified bidders in the market for their power supply.
In his more than two decades in the power industry, Castro said that this is the lowest rate that he has seen, so far.
“That’s why, we are taking advantage of this, and we hope to sustain this for the long term,” he said.
Castro said lower electricity rate is part of MORE Power’s sincere and serious commitment of giving Ilonggos the best possible price of electricity.
Karen Joy Elequin, Energy Sourcing and Corporate Planning & Regulatory Affairs Department manager of More Power, earlier projected lower power rates due to cheaper electricity from the Unified Leyte Geothermal Power Plants ran by the Power Sector Assets and Liabilities Management Corp (PSALM).
Based on the data gathered by MORE Power, it has one of the lowest rates compared to other power distributors in the region and even Meralco, the country’s largest power distribution utility firm with a franchise area covering Metro Manila and a big part of Luzon.
Based on available data of the July 2021 electricity bill, MORE Power’s average electricity per kWh is at P6.4175, which already includes charges for generation, transmission, system loss, distribution, subsidies and others, and government taxes.
Meralco has an average rate of P10.1513, Central Negros Electric Cooperative, Inc. or CENECO (Bacolod City) – P10.5043; Aklan Electric Cooperative, Inc. or AKELCO (Aklan) – P10.7744, Iloilo Electric Cooperative 3 or ILECO 3 (portions of Iloilo province) – P11.0268, ILECO 2 – P11.5061; Antique Electric Cooperative (Antique) – P11.5965; and Capiz Electric Cooperative (Capiz) – 12.1046.
Elequin clarified that the data does not represent the nationwide ranking of power distributors or electric cooperatives.
PROMISE FULFILLED
The current rate is a far cry from what Iloilo City consumers used to pay to previous power distributor, Panay Electric Company (PECO).
Based on MORE Power’s records, PECO had an average rate of P11.4190 per kWh. Its maximum rate was P12.3068 and minimum of P10.3730.
On the other hand, MORE Power has an average rate of P9.8853 per kWh more than a year after it took over Iloilo City’s power distribution business. Its maximum rate was pegged at P10.5212 per kWh and its lowest at P6.4562 per kWh.
Castro said Ilonggo consumers are assured of cheaper rates in the next six months.
But it does not mean that electricity rates will rise again after six months as MORE Power would continue to look for the most affordable power supply.
If there would be an increase after that, Neil Parcon, head of MORE Power’s Corporate Planning and Regulatory Affairs Department, said the increase would not be that high.
When asked if there is a possibility that the rate could be further reduced, Parcon said that it’s still possible, but it could go down by P0.30 per kWh.
ELECTRICITY TRADING
In June 2021, MORE Power announced that it is already an active participant in the trading of electricity as it directly purchases 100 percent of its power supply requirement from the Visayas grid via its new switching station in Banuyao, Lapaz.
Inaugurated in May 26, the station connects Iloilo City directly to the National Grid Corporation of the Philippines (NGCP) which manages the transmission lines or “superhighway” between power plants and distribution utilities and electric cooperatives.
Despite numerous price spikes in the Wholesale Electricity Spot Market (WESM), Castro said they were able to bring down the blended generation rate by a significant P2.5/kWh.
However, the competitive Time of Use-rates from its source PSALM Corporation (renewable Geothermal generating plant in Leyte), positive Line Rental from Leyte power source, and positive Net Settlement Surplus cushioned the impact of very high WESM prices to the total generation rate of More Power.
With already several hundreds of illegal connections busted, Castro said there are still “hard core” residents who choose to avail of electricity through illegal means.
“That’s why, we continue to appeal to our consumers to help us in our quest to end these illegal connections. We still have a big number of them,” he said.
Apart from jumpers, he also asked consumers to refrain using submeters. In some instances, users are being charged P15-20 per kWh.
“We now make applications easier and more lenient. We have come up with requirements that they would find easy to fulfill,” Castro said.
Currently, MORE Power has around 85,000 consumers, up by more than P20,000 consumers from the previous utility distributor.
“But we still have many illegal connections,” he admitted.
Meanwhile, Castro also asked for understanding as zero outages cannot be expected soon because they’re still fixing a lot of technical issues.
“But we ask you, trust us, in due time, things would be way better,” he said.
(Updated to correct the 30th paragraph with Mr. Roel Castro’s quote)
