Published: July 29, 2021 | Posted by: Venus Zoleta | Personal Finance
Don’t you just hate getting shocked by how much your electricity bill has increased compared to previous months? Especially now that you’re mostly at home, your electric consumption is probably higher than before. This is also because Meralco rates are up for the fourth straight month this July.
But if it’s any consolation, you’re not the only consumer surprised by Meralco’s current rate hikes. In fact, the increase in Meralco’s per kilowatt rate in 2021 has prompted more than 100,000 consumers to create a Facebook group to raise complaints about their electricity bills.
Amid the financial impacts of the pandemic which we’re all still struggling to overcome, we don’t need additional financial strain from constantly increasing utility bills. So here’s a guide to help you understand the reasons for the recent Meralco rate hikes and how to compute Meralco bill to avoid bill shock.
Table of Contents
According to Meralco, only 17% of your total bill goes to the company. This means that if your total bill for June 2021 is PHP 3,000, only PHP 510 of this goes to Meralco.
So where does the rest of your payment go? Here’s the breakdown.
The Generation Charge goes to paying Meralco’s electricity suppliers, like the Independent Power Producers (IPPs) and other power producers.
The transmission charge is also known as the delivery charge. When Meralco buys electricity from its power suppliers, it pays 10.1% for the cost of delivery for the electricity to reach Meralco’s distribution system. The transmission charge goes to the National Grid Corporation of the Philippines (NGCP), which is the provider of transmission services.
Meralco takes 17.5% from your bill to cover the cost of distribution, which pays for the construction, development, operation, and maintenance of the distribution system. This distribution system is used in delivering electricity from high-voltage transmission grids to end-users.
This covers local franchise tax, Value Added Tax, Tax Recovery Adjustment Charge (TRAC), and Missionary Electrification Charge, just to name a few.
System loss and Feed-in-Tariff Allowance compose other payables covered by your Meralco bill. A portion of your payment also goes to subsidies provided as a lifeline for low-income customers and senior citizens through a discount of 5% on their bills.
According to Meralco, there are a lot of factors contributing to the increased rates. In June, charges at the Wholesale Electricity Spot Market (WESM) increased by PHP 1.6322 per kWh because of the tight supply conditions in the Luzon grid.
Below are other factors you should be aware of.
Heat index, also known as the apparent temperature, is what the temperature feels like to the human body when relative humidity is combined with the air temperature. The highest heat index recorded so far this year is 52°C in Dagupan.
When the heat index is high, appliances at home are forced to work harder and longer to cope with the temperature. From April to June of this year, high heat indexes prompted the National Grid Corporation of the Philippines to issue red alerts and implement rotational brownouts in Luzon.
In contrast, during rainy months, the temperature is colder. You won’t feel the need to use the air conditioner or electric fan as much, resulting in lower electricity consumption.
If you hate surprises like a sudden and significant spike in your Meralco bill, then you need to prepare your budget. Before your next Meralco bill arrives, know how to compute your electric consumption for the month based on Meralco’s announced rate increase. This will help you correctly compute your potential bill for the month. Here are Meralco’s rate increases since April of this year.
April = PHP 0.0872/kWh to PHP 8.406/kWh
May = PHP 0.1853/kWh to PHP 8.59/kWh
June = PHP 0.0798/kWh to PHP 8.6718/kWh
July = PHP 0.2353/kWh to PHP 8.9071/kWh
This also shows how a household with 200kWh consumption paid an additional PHP 17.44 in April and PHP 37.06 in May.
The difference in billing for April and May is PHP 36.66, which is still manageable even with the rate increase in May. So even if your electric consumption is the same but the electricity rates increased, you will still see an increase in your electricity bill.
But it’s different when your electricity consumption increases and Meralco rates also increase. Here’s the difference when you increase your consumption to 300 kWh:
The additional 100 kWh on your consumption costs PHP 895.66, which is a significant amount. This can be a surprise for most, especially if you’re not aware of your increased consumption and increase in Meralco’s electricity rate.
If you want to learn how to compute your Meralco bill, you should know that the type, quantity, and quality of your appliances can greatly affect your consumption rates.
To compute how many kWh an appliance uses, follow this formula:
Wattage/1,000 x number of hours the appliance is used
For a 1HP, 950-watt, non-inverter air conditioner, here’s a sample computation.
|Appliance||Wattage||Cost Per Hour||Cost Per Day if 10 Hrs/Day||Cost Per Week||Rate Per Month|
|Air Conditioner (Non-Inverter, Window Type, 1HP)||950||PHP 8.46||PHP 84.60||PHP 592.20||PHP 2,368.80|
|Regular Stand Fan||150||PHP 1.50||PHP 15.00||PHP 105.00||PHP 42.00|
Indeed, if you’re using air conditioners instead of electric fans, your electric consumption will be higher. However, if you’re using more than one electric fan all for extended hours, then your electricity consumption will be the same as when you’re using an aircon.
Did you know that an older refrigerator consumes 66% more electricity compared to a newer model of refrigerator? Every appliance loses its energy efficiency as it ages. If you know which appliances you’re using the most at home and their condition, you’ll have a good idea of how much your bill would be each month.
Your electric meter plays a critical role on learning how to compute Meralco bill. Meralco uses your meter readings for the past month and present month to determine your total electricity usage in kilowatt per hour (kWh), which is the basis for computing your monthly bill.
Why bother reading your meter yourself? Even if Meralco has trained meter readers who can do the job accurately, being able to read your electric meter lets you keep track of your power consumption to ensure that your household isn’t consuming too much electricity.
If your electric meter has a small digital screen display, finding out your electricity consumption is pretty simple and straightforward. Just read the numbers from left to right.
You have an electromechanical meter if it has four dials instead of a digital numerical display. It looks more complicated than a digital meter because its dials move in opposite directions (two moving clockwise and the other two moving counter-clockwise). But it’s actually easy to read. Simply take note of the number that each dial is pointing at, beginning from the rightmost dial to the leftmost dial.
Record your reading this month and subtract it from your reading for the following month. The resulting kWh may not match the actual kWh reflected on your next Meralco bill (as Meralco’s meter reading date may be different from yours), but it at least gives you an estimate of your monthly power consumption.
Many different factors affect electricity prices, and they change from time to time. Also, the monthly bill consists of several electricity charges that Meralco calculates using various percentages. A Meralco bill might be too complicated for an average consumer to comprehend.
So if you’re trying to figure out how to compute Meralco bill, know that it’s impossible to do on your own. You won’t know in advance the exact amount to pay for a particular month until your bill arrives.
However, if you’re aiming to save on your electric bill, you can compute the cost of using each appliance and electronic device in your home.
Read more about Meralco: A Guide to Paying Electricity Bills with Meralco Online
Follow these steps to manually estimate the electricity consumption of a specific device:
List down the monthly electricity usage of your appliances and devices and rank them from highest to lowest. This will let you know which ones consume the most electricity and should be used less and unplugged more often.
The formula discussed above is a just simplified approach to estimating your monthly electricity consumption. If you want to know the cost of using your home appliances and devices, use an online calculator that will compute it for you. You may use either the Meralco Appliance Calculator or Wattmatters Calculator.
The best way to compute electric consumption is to use the Meralco calculator, which is currently available on the Meralco Mobile app only.
You may access the Meralco Appliance Calculator without having to register for an account or logging in (if you already have an account).
After installing the Meralco mobile app, you can start computing the electricity cost of your appliances. Here’s how:
Using the Meralco Mobile app, you can compute only for one appliance at a time. You have to repeat the entire procedure if you want to compute your electricity cost for other appliances.
A project by the Department of Energy that promotes energy efficiency, Wattmatters.org.ph has an online consumption calculator that lets you find out how much each of your appliance contributes to your monthly Meralco bill.
Unlike the Meralco Appliance Calculator, the Wattmatter Calculator allows computing for two or more appliances simultaneously to get your total monthly bill.
Here are the steps to compute your Meralco bill using the Wattmatters calculator:
Do you have concerns about your Meralco bill? Is your electric bill way higher than last month’s? For such concerns, you can contact Meralco through the following:
You can also use the Meralco Mobile app and the Meralco Online website to file a complaint. Just head to the Contact Us page for both the app and website.
The Meralco rate per kWh for 2021 has seen an increase since April. For July 2021, the rate is PHP 8.9071/kWh.
It’s the same as computing through the main Meralco meter. The rate, however, will depend on your agreement with the primary owner of the Meralco account.
You can pay your Meralco bill via credit card in three ways:
Here are a few credit cards you can use to pay Meralco bills:
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Knowing how to compute Meralco bill can save you a lot of stress come bills payment time. Understanding the factors that affect your monthly bill can help you cut down on electricity usage as well. Just like paying for your Meralco bill, computing it in advance is somewhat painful but necessary to ensure your household electricity consumption is under control.
Venus is the Head of Content at Moneymax, with 15+ years of experience in digital marketing, corporate communications, PR, and journalism. She invests in stocks, mutual funds, VUL, and Pag-IBIG MP2. Outside of work, she’s crazy about cats and Korean dramas. Follow Venus on LinkedIn.