THE MANILA Electric Company (Meralco) has literally made a cash cow of its millions of consumers to shore up its revenues. It has yet to refund its customers for its previous overcharges, but it is implementing its 6th electricity rate increase this June.
The Energy Regulatory Commission ordered Meralco to refund each customer from their monthly bills beginning May 2026 to May 2027 the amount of P0.4278/kWh so that a typical household consuming 200 kWh can receive an AWAT (actual weighted average tariff) refund of P85.56 per month.
But sooner than it can pay out this refund, Meralco already said it would raise for the 6th time this year its electricity rates by P.15 /kWh in June because of higher generation charge, an excuse it used since 2022 and for which it was found by ERC to have overcharged its users.
Meralco Vice President and Head of Corporate Communications Joe Zaldarriaga told reporters in a virtual briefing that this brings the overall rate for a typical household to P14.4833/kWh this June from PHP14.3345/kWh in May.
For residential customers consuming 200 kWh, the adjustment translates to an increase of P30 in their total electricity bill.
He claimed the generation charge rose by P0.27/kWh to P9.0704 this month from P8.7942/kWh last month.
Wholesale Electricity Spot Market (WESM) prices also increased to P7.0281/kWh due to tight supply conditions in the Luzon grid, which was placed under red alert on May 13 to 15 as electricity demand exceeded the record level set in 2024, the PNA reported.
Meralco said that as a result, the secondary price cap was imposed 3.89 percent of the time, indicating persistently high spot market prices during the period.
This was partially offset by lower line rental and other charges following the lifting of the suspension of WESM operations on May 1.
Meralco said customers were largely shielded from increases in line rental charges since Meralco suppliers absorbed a substantial portion of these costs under recently ERC-approved power supply agreements (PSAs).
For pre-EPIRA power supply contracts with the Sta. Rita and San Lorenzo gas plants, line rental charges are passed through in full to consumers.
Excluding line rental adjustments, PSA charges rose slightly by P0.0941/kWh, because of the peso depreciation, which affected 54 percent of PSA costs, and higher world market prices for coal and liquefied natural gas (LNG).
Charges from the Sta. Rita and San Lorenzo gas plants of First Gas/ Prime CoreGen decreased by P0.1569/kWh due to improved average dispatch.
Meralco said this offset the impact of higher fuel costs resulting from increased LNG usage and peso depreciation, which affected 99 percent of First Gas/Prime CoreGen’s charges.
PSAs, First Gas/Prime CoreGen, and WESM accounted for 69 percent, 21 percent, and 10 percent, respectively, of Meralco’s total energy requirements during the period.
The transmission charge declined by P0.1525/kWh, while taxes and other charges increased slightly by P0.0251/kWh.
High Consumption
Meralco also reminded customers that consumption increased significantly because of extreme heat that led to higher June bills.
While there is an increase in electricity rates this month, elevated consumption patterns observed in May driving higher electricity bills, Zaldarriaga said.
Meralco urged customers to continue managing and monitoring their electricity consumption, check the historical consumption chart included in their bills, or use the Meralco Appliance Calculator, which provides detailed information on the energy consumption of common appliances and gadgets.
“In addition, we urge customers to learn how to read their electric meters so they can gain better visibility into their actual consumption, monitor their energy use, and adopt habits that help manage electricity costs more effectively,” Zaldarriaga said.
The ERC has ordered Meralco to refund a remaining balance of approximately P 14.17 billion to its customers in 12 months beginning MAY 2026 to April 2027 instead of a 36 months schedule following a “true-up” process for distribution charges from July 2022 to December 2024. The refund would appear in the monthly bills as “AWAT (Refund)/Collect” under Rate Components on the back of the bill.