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Manila Bulletin devider Business devider Trade & Industry devider ERC to start long-delayed power utility rate reset

ERC to start long-delayed power utility rate reset

Published Oct 20, 2025 12:00 am  |  Updated Oct 18, 2025 02:03 pm
Consumers may soon see fairer or more reasonable power rates as the Energy Regulatory Commission (ERC) begins the long-awaited rate reset process for Manila Electric Co. (Meralco) and other private distribution utilities.
In a statement, the ERC said it has approved the new Rationalized Rules for Setting Distribution Wheeling Rates (RRDWR), which details how DUs under the performance-based system will set their electricity charges to their service areas.
According to the commission, the RRDWR approval “marks a departure from the previous Regulatory Periods established for the PDUs, which were not adhered to due to the suspension or delays in the rate reset process.”
The new guideline also defines the procedures for determining revenue requirements, capital and operating expenditures, performance incentive mechanisms, and annual rate adjustments— all of which are vital to ensuring more reasonable electricity prices for consumers.
“Under the RRDWR, the ERC uses a price-cap regulation methodology that sets a maximum allowable rate based on efficient costs, service quality targets, and measurable performance indicators,” it stated.
This would also serve as a framework for the upcoming regulatory reset for the first regulatory period (1st RP) of Meralco, Dagupan Electric Corporation (DECORP), Cagayan Electric Power and Light Company (CEPALCO), and Cotabato Light and Power Company (CLPC). The reset would ensure that electricity rates are updated and reflect current costs, instead of outdated charges.
The application for the 1st RP would cover July 1, 2026, to June 30, 2030.
Meralco has earlier expressed its plans in its 1st RP, namely to develop a complementary system control center (SCC) called the Grid Edge Operations and Control Center (GEOCC), which would accommodate the rise of electric vehicles (EVs), batteries, and solar rooftops. This development is expected to be completed by 2030.
Highlighting the decade-long overdue reset process, the ERC assured consumers and DUs of its commitment to manage reasonable rates, ensure operational efficiency, and support the ongoing modernization in the power sector.

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Energy Regulatory Commission (ERC) Manila Electric Co. (Meralco)
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