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Manila Bulletin devider Business devider Trade & Industry devider Meralco seeks to cap rate hike as fuel costs, weak peso bite

Meralco seeks to cap rate hike as fuel costs, weak peso bite

Published May 12, 2026 04:49 pm
Manila Electric Co. (Meralco) has asked regulators for permission to cap an expected spike in electricity rates this month to shield households from surging generation costs and a weakening currency.
In a proposal submitted to the Energy Regulatory Commission (ERC), the country’s largest power distributor outlined a series of mitigating measures designed to soften the blow of higher fuel prices and the peso’s depreciation against the United States (US) dollar.
Without these interventions, Meralco projected that generation charges would climb by ₱1.0277 per kilowatt-hour. Meralco is instead pushing for the early implementation of adjustments under its existing power supply agreements to offset the total bill.
Larry Fernandez, Meralco head of utility economics, said the main driver of the May price hike was the increase in line rental charges—the costs associated with moving power through the transmission system—following preliminary billing from the Independent Electricity Market Operator of the Philippines.
Under many of Meralco’s ERC-approved contracts, line rental charges for energy delivered by power generators are capped.
Fernandez noted that any costs exceeding these limits are typically absorbed by the generation companies rather than being passed on to the end-user.
By applying these credits and adjustments now, the utility aims to prevent a significant “bill shock” for its residential and commercial customers.
ERC Chairperson and Chief Executive Officer Francis Saturnino Juan commended the initiative, noting that the regulator is looking for ways to ease the financial burden on Filipino households amid international market pressures.
Juan said that while certain costs are dictated by global fuel indices and are beyond domestic control, the commission is committed to ensuring that all pass-through charges remain transparent and reasonable.
The utility’s proposal is part of a broader effort to manage the fallout from the Wholesale Electricity Spot Market’s recent price movements. Meralco’s final overall rate adjustment is expected to be officially announced on Wednesday, May 13.

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