MANILA - Customers of the Manila Electric Co. (Meralco) will continue to enjoy lower electricity prices for the month of July due to the power distributor's low generation charge.

Ivanna dela Pena, head of utility economics at Meralco, said that the generation charge for July was flat at P4.2620 per kilowatt-hour (kWh), compared to June's P4.2583 per kWh.

"The close to P0.80 cumulative reduction experienced by our customers the past two months has been preserved," dela Pena noted.

She said the generaton charge remains low due to cheaper power purchased by Meralco from contracted independent power producers (IPPs) and the wholesale electricity spot market.

According to her, "the dispatch of our IPPs had improved while prices in the WESM had remained low."

Earlier, Meralco customers enjoyed two significant reductions in the generation charge: the P0.16 per kWh in June and the P0.60 per kWh in May.

The generation charge is a pass-through cost that power distributors merely pass on to consumers. This means that whatever savings a distributor incurs from cheaper power will also be passed on to customers in the form of lower electricity bills.

At present, Meralco serves over 4 million customers in 25 cities and 86 municipalities in its franchise area.