Before the National Power Corp.’s full-scale privatization around 2007-2008, Metro Manila households were paying a mere ₱4.00 to ₱4.50 per kilowatt-hour on their electric bills. Today? Consumers are choking on rates that have nearly tripled, surpassing ₱13 per kWh—with service stuck in the same old rut and fewer answers or explanations on the runaway tariffs.

No wonder consumers are furious every time a bill lands. The Electric Power Industry Reform Act (EPIRA) was pitched as the cure-all for high electricity rates and unstable supply. Instead, all we've gotten is a bitter dose of broken promises and skyrocketing costs. 

Nearly 25 years later, the “holy grail” of low rates and steady supply remains a myth, yet industry players call it a success. But for whom? The only clear winners are the private firms raking in billions in yearly income, while consumers are trapped with ever-rising rates and poor service.

Sure, soaring electricity tariffs are blamed on various factors: inflation, borrowing and capital costs, and a pile-up of taxes. But here’s the uncomfortable question: Are consumers also footing the bill for the luxury lifestyles of energy executives? From first-class flights or private jet travel to five-star hotel accommodations, fine dining, luxury cars, and elitist hobbies—these perks stack up, especially since private sector salaries tower over government pay.

With the freedom to charge ‘corporate expenses,’ one has to ask: Does the regulator truly scrutinize all these pass-on costs? Or are we all just paying for someone else’s excess? Creative accounting may be clever, but is the Energy Regulatory Commission (ERC) sharp enough to detect it?

If there’s one brutal truth the world’s richest countries teach us, it’s this: No nation escapes poverty while drowning in government corruption and suffocating under corporate greed. Prudence isn’t just a government duty; fiscal discipline must hit the corporate boardrooms too, because reckless spending and unchecked greed in the private sector can bleed a nation just as fast. In fact, some of these corporate executives might be joining the anti-corruption rallies and playing the 'woke card,' all while remaining blind to the very ‘overindulgences’ they're also guilty of.

Filipinos are busy battling corruption, and corporate greed hasn’t even hit the radar yet—but that’s the silent killer. In the energy sector, it’s not just backroom deals we should fear, but the ‘quiet collusion’ that could be driving our electric bills through the roof.

CSP as shield versus backroom deals?

In 2019, the Supreme Court, in a case filed by Alyansa Para Sa Bagong Pilipinas, rendered a final decision ordering the ERC to enforce the Competitive Selection Process (CSP), or bidding, for all power supply agreements (PSAs). The mandate: ensure that only the ‘least cost power’ wins, forcing generation companies/power suppliers to compete on price, not on political pull or backroom favors.

Just recently, the advocacy group P4P Coalition once again stormed the ERC offices, voicing their mounting frustration over relentless power rate hikes. Of all the players, Manila Electric Company (Meralco) stands in the harshest spotlight. P4P primarily sounded off: “We are disappointed that Chair Saturnino Juan’s first order of business as new ERC chief is to cede ground to power players, enabling them to raise prices as they please at the expense of ordinary Filipinos. Protecting consumers’ interests is not an optional duty for the ERC. It is its primary mandate—and part of that responsibility is scrutinizing these contracts to prevent abuses and ensure least cost electricity.”

ERC Chairman Francis Saturnino Juan’s response was a carefully worded promise, declaring, “I welcome such forms of engagement with our most important stakeholders—the consumers. I anticipate engaging in a productive dialogue with them, whether through the formal consultative processes established at the ERC or through other channels.”

The ERC is flexing the CSP as a fortress protecting consumers with ‘competitive rates,’ grounded on a ‘least cost’ tender that Distribution Utilities (DUs), like Meralco, can lock in for their supply contracts.

Juan expounded: “The CSP is the engineered mechanism designed by the DOE to fulfill EPIRA’s pro-competitive mandate. It is a transparent, public, and competitive bidding where distribution utilities seek the least-cost power supply to serve their captive consumers. It is designed to discover the true, fair market price through the forces of supply and demand, not through closed-door negotiations.” He further noted that “the ERC’s primary duty in its rate-setting function must be to uphold the outcomes of a genuinely competitive CSP.”

However, does the CSP truly lower rates for consumers? So far, industry developments prove otherwise, as there has been no real drop in power rates—though the ERC highlights the CSP's advantage is achieving that ‘competitive rates’ outcome for consumers.

The tightrope walk of ERC oversight

Juan plainly framed the CSP’s two-tiered mission: first, to unleash competition so the market finds the lowest cost for consumers; and second, to protect investors’ hefty risks by guaranteeing cost recovery. This balance, he promises, will build a reliable supply and a modern grid for the country’s energy future.

“When a CSP has been conducted properly—transparently, fairly, and with robust competition—the resulting price is not just a number offered by a generator. It is the market’s definitive answer to the question: what is the least-cost power available today? It is a price validated by the competitive process itself,” he explained.

The ERC chair stressed: “To second-guess this outcome and unilaterally reduce this contracted rate under the guise of regulatory review risks undermining the entire foundation of the competitive market we are all trying to build and promote. It creates regulatory uncertainty that discourages the very investment we need.”

He added, “It tells investors: you competed and won fairly, but the goalposts may still move during the PSA review process at ERC. This does not protect consumers; it ultimately harms them by chilling investment, threatening future supply, and jeopardizing the long-term reliability and affordability of our power.”

Juan qualified, though, that the ERC can’t just rubber-stamp every PSA—its regulatory watchdog role is vital: to rigorously verify that the CSP was genuinely competitive, costs are reasonable, and no dirty dealings slipped through. But once fairness and prudence are proven, the regulator must have the guts to trust the market it was mandated to create and promote. Why? Because honoring a competitively-set price is the strongest shield consumers have against the hidden costs of uncertainty, underinvestment, and creeping monopolies.

Beyond approving PSA rates under the CSP, the ERC also regulates tariffs for transmission provider NGCP and the power utilities. But with rates relentlessly rising and services relatively failing to progress, can the regulator actually detect and penalize abuses? Just like in the flood control controversy, are ‘ghost projects’ also plaguing the energy sector, especially in the capital expenditure (capex) program of DUs?

That’s a tough challenge for the ‘transformative ERC’ that the new Chairman promises, and everyone is watching if they can actually deliver—not just on lower or competitive rates, but better service for the consumers.