Philippines Electricity Rate – June 2017

The Highest Electricity Rate in the World is Italy and the Second is the Philippines – *June 2017

*Reference: World Atlas 2014 report modified February 9, 2017. Please visit other resources for your reference and guidance.

The Philippines is quite unlucky for having so many government officials, both past and present, and in the high echelons of government who know nothing about “foresight” and worse, probably know nothing about “hindsight”, too.

Most expensive electricity of the world – WorldAtlas

“Italy Has The Highest Electricity cost in the world @ $0.2101/kWh and Germany takes the second place @ $0.1921/kWh “– World Atlas.
What is not shown in the World Atlas report is Japan and the Philippines electricity rates. Taking Japan aside, the Philippines, NOT GERMANY, has the second most expensive electricity rate in the world @$0.20/kWh.

1. Italy: $0.2101/kWh = PhP10.64/kWh
2. Philippines: $0.20/kWh = PhP9.89/kWh
3. *Germany: $0.1921/kWh = PhP9.73/kWh

*Sidelights: Germany Renewable Energy Program Drives Up Costs

Earning Capacity Vs. Energy cost per kWh of the Philippines and Italy

Neglecting income taxes and the cost of basic commodities and services in Italy, let us create a ballpark estimate of the paying capacity of Italians and the Pilipinos for electric energy by comparing the average gross monthly income of teachers in Italy and the Philippines.

ITALY

How much can an Italian teacher buy with his gross monthly income of USD1,953.36/month?

If an Italian teacher uses his 1-month gross income to buy electricity:
Average gross monthly income for teachers in Italy = 1,711Euro (USD1,953.36)/month.
Converted to Philippine Peso (PHP) this amounts to 1,711Euro X PhP57.808/Euro = PhP98,909.488.

How much electricity can he buy for his gross monthly income of USD1953.36 @$0.2101/kWh? The teacher can buy USD 1953.36/USD 0.2101/kWh = 9,297.30kWh with his 1-month gross income.

Checking: 9,297.30kWh x $0.2191kWh = $1,953.36 

THE PHILIPPINES

The average gross monthly income for a High School Teacher is PHP224,302 per year/12mo. = PhP18,691/month. People in this job category generally don’t have more than 20 years experience.

Let’s use the Philippine teachers average salary of PhP18,691/month to buy electricity:

PhP18,691/PhP9.89/kWh = 1,890kWh with their 1-month gross income. Contrast this with Italian teacher who can buy 9,297.30kWh with his 1-month gross salary!

Do you still wonder why many manufacturing companies have their products manufactured in other countries and then have them shipped to the Philippines? Their products will still be much cheaper even when they have to pay shipping charges and insurance cost.

Average Energy Consumption of middle-income families in the Philippines

The average household consumption of electricity in the Philippines ranges from 250kWh to about 500kWh/month. Let’s use 400kWh as a baseline and divide 9,297.30kWh an Italian teacher can buy with his 1-month gross income: 9,297.30kWh/400kWh/month = 23.24 months!

WOW! This means an Italian teacher’s gross income of PhP98,909.488/month can buy the Philippine middle-income group enough electricity to last for almost 2 years! Fantastic, isn’t it?

Japan vs. the Philippines

We find comfort in reading that the highest electricity rate in Asia is Japan and the Philippines is only number 2. But again let’s compare the basic salary of Japanese teacher with the Philippine teachers. We’ll select  $45,515 USD/annum based on World of Education website:

“In Japan, public school teachers are paid [paid] by the Prefectural Government. In 2005, the average salary for an elementary teacher is equivalent to $45,515 USD. Japanese teachers are the 5th best paid behind Luxembourg, Switzerland, Germany and Korea.”

Japanese teachers monthly gross income in 2005 = $45,515/12 = $3,792.92/month
Power Rates/kWh is based on Realestate-Tokyo.Com website: The energy charge (Power Consumption Rate) has 3 steps as represented below:

~ 120kwh – ¥19.43/ kWh
121kwh ~ 300kwh – ¥25.91/ kWh
301kwh ~  ¥29.93/ kWh = USD 0.26/kWh

Let’s select 301kwh ~ – ¥29.93/ kWh = USD 0.26/kWh

Again let’s neglect income taxes, the cost of basic commodities and services in Japan and let’s create a ballpark estimate of the paying capacity of people in Japan and the Philippines for energy consumption.

Japan: $0.26/kWh = PhP13.17/kWh for monthly consumption of 300kWh and above
– Philippines: $0.20/kWh = PhP9.89/kWh.

How much energy can the Japanese elementary teacher buy with his gross monthly income of $3,792.92/month @$0.26/kWh? The Japanese teacher can buy USD 3,792.92/USD 0.26/kWh = 14,588kWh with his 1-month gross income.

Again let’s use 400kWh as a baseline and divide 14,588kWh a Japanese teacher can buy with his 1-month gross income: 14,588kWh/400kWh/month = 36.47 months!

Thus if a Japanese household consumes 400kWh/month, his gross monthly income can buy him enough electricity for the next 3 years!

For a third world country, you can see from the above that the Philippines electricity rate is grossly disproportionate to its average citizens’ paying capacity. America, the most powerful nation in the world, pays only half of what the Philipines pays at just $0.10/kWh or PhP5.86/kWh at current exchange rate.

Philippines Average Nominal Wages 2001-2017 | Data | Chart | Calendar

“Wages in the Philippines increased to 8280 PHP/Month in 2011 from 7995 PHP/Month in 2010. Wages in the Philippines averaged 6830.00 PHP/Month from 2001 until 2011, reaching an all-time high of 8280.00 PHP/Month in 2011 and a record low of 5798.00 PHP/Month in 2001”. – TradingEconomics.Com

Sidelights: Germany Renewable Energy Program Drives Up Costs
– WorldAtlas 2014 report modified Feb. 9, 2017

“Germany comes in as a close second, with electricity prices of $0.19 per kilowatt hour. Due to this, it has been reported that the country has developed a program for increasing the contribution of electricity sourced from renewable sources to upwards of 80% by the calendar year 2050. During the first quarter of 2014, the country produced a record-setting 27% of its electricity via renewable sources, a result of both favorable weather and an increased capacity to utilize renewable energy within the country.

There are ramifications involved in Germany’s contemporary renewable energy program, including an instable electric grid, the burden being placed upon German households by increased costs for electricity, and the need for secure back-up power that is affordable and reliable. Currently, utility companies within the country are receiving payments from the grid as a measure of stabilizing a network that has been disrupted due to surges and falls in contributions from solar and wind power sources. Coal is being utilized in a heftier manner in order to back-up the renewable technologies (and their intermittent nature) while delivering a reliable base load of power, although at the risk of increasing emissions of carbon dioxide. The result has been German residents having to pay feed-in-tariffs in addition to high utility costs as a measure of subsidizing the renewable energy technologies.” – WorldAtlas

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