Visayan Electric Co., the main power distributor in Metro Cebu, announced a 21-centavo increase in its residential rate—from P12.36 per kilowatt-hour (kWh) in March to P12.57 per kWh.
For a typical household consuming 200 kWh, this translates to an increase of about P42 in the monthly bill, the company said.
Market volatility
This was due to the 4.62-percent adjustment in transmission cost implemented by National Grid Corporation of the Philippines (NGCP) on distribution utilities and electric cooperatives for the March billing, bringing the rate to P1.7526 per kWh from February’s P1.6810 per kWh.
The adjustment reflects ongoing pressures from volatile global energy markets.
“These conditions are largely driven by external factors beyond our control, but our priority has always been to protect our customers from sudden and significant increases,” said Mark Anthony B. Kindica, Visayan Electric’s president and general manager, in a statement.
“Through disciplined contract management and close coordination with government partners, we have managed this month’s adjustment while ensuring reliable service,” he added.
The second-largest electric utility in the Philippines, it serves 2.6 million people in the cities of Cebu, Mandaue, Talisay and Naga and the towns of Liloan, Consolacion, Minglanilla and San Fernando.
Ancillary services
In a statement, the NGCP said the adjustment in transmission rates was due to an increase in Ancillary Service (AS) rates, from P0.8275 per kWh in February to P0.8516 per kWh in March.
The AS is a pass-through cost for power supplied by power generators that are AS providers during supply-demand imbalance.
The NGCP maintained that it does not earn from AS and does not benefit from any change in AS prices because these are remitted directly to generation companies with bilateral contracts with NGCP, and to the Independent Electricity Market Operator of the Philippines (IEMOP) for AS sourced from the Reserve Market.
Wheeling rate
NGCP’s transmission wheeling rate, or the fee for delivering power through the transmission grid slightly increased to P0.7022 per kWh in March from P0.6677 per kWh in February.
“The increase in effective transmission wheeling rates has no impact on NGCP’s revenue, as the company’s allowable revenue is capped by the Energy Regulatory Commission (ERC),” NGCP clarified.
NGCP reiterated that ancillary service (AS) charges make up the largest portion of the overall transmission rate.
"As the system operator, NGCP’s priority is to ensure the grid remains resilient during supply-demand imbalances. NGCP does not profit from AS charges, as these are remitted directly to the providers who help us maintain the continuous flow of electricity across the country," NGCP said. —Ed: Corrie S. Narisma
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