The line-up of new capital projects and network expansion to prepare for more customer connections and higher demand in the coming years prompted Manila Electric Company (Meralco) to seek new tariff adjustments under its third regulatory reset under performance-based regulation.

In its routinary filing with the Energy Regulatory Commission (ERC), the utility firm noted that its average tariff will go up to P1.7056 per kilowatt hour (kWh) by year 2012 from P1.6464 per kWh rate reference, which is also pending for the regulator’s approval.

By 2013, the estimated maximum average price (MAP) that Meralco charges will be P1.7686 per kWh. By 2014, it will be at P1.8349 per kWh; and P1.9036 per kWh in 2015.

It must be noted that as compared to the company’s second regulatory reset, the tariff adjustment it is seeking in the next four years will be “softer” at P0.05 to P0.06 per kWh increments as compared to the P0.10 to P0.12 per kWh it sought for regulatory years 2007-2011.

Translated into residential rates, including distribution, supply and metering charges, the average wheeling rate of Meralco will be P2.9587 per kWh in 2012 from P2.8564 per kWh as forecasted in 2011; P3.0676 per kWh in 2013; P3.1824 per kWh in 2014; and P3.3017 per kWh in 2015.

The regulated asset base (RAB), which factors in capital expenditures (including construction work in progress (CWIP) for projects), depreciation and other building blocks which were taken as reference in the proposed tariff adjustments for Meralco are as follows: P158.248 billion for 2012; P162.442 billion in 2013; P167.519 billion in 2014; and P170.939 billion in 2015.

Among the capital projects lined up by Meralco are: Development of four new substations; expansion of 16 existing substations; construction of 115-kV sub-transmission line; construction of 52 new distribution feeders related to substation projects; construction of three new sub-transmission lines and uprating of one existing sub-transmission line, among others.

The network expansion, according to Meralco, is intended to keep pace with increased sales in the coming years.