By Benjamin Cuaresma
MANILA — Millions of electricity consumers will face another increase in their monthly power bills beginning this August after the Energy Regulatory Commission (ERC) approved a higher renewable energy surcharge, while also allowing Manila Electric Co. (Meralco) to recover P8.7 billion in previously uncollected pass-through costs.
The ERC granted provisional authority to the National Transmission Corp. (TransCo) to increase the Feed-in Tariff Allowance (FIT-All) from P0.2011 to P0.3359 per kilowatt-hour, an adjustment of P0.1348 per kWh that will take effect in the August billing cycle.
The higher FIT-All rate means households consuming 500 kilowatt-hours (kWh) a month will pay roughly P168 in renewable energy charges alone.
FIT-All is a uniform charge imposed on all grid-connected electricity consumers to finance incentives granted to qualified renewable energy developers, including solar, wind and small hydroelectric projects, for up to 20 years.
According to TransCo, the increase was necessary after the FIT-All Fund entered 2026 without the required working capital allowance needed to maintain stable cash flow for payments to renewable energy producers.
Records showed that as of May 7, the fund had accumulated a negative working capital balance of P322.9 million, prompting the state-run transmission firm to seek an immediate adjustment.
The ERC said the financial condition of the fund justified granting provisional authority even before the completion of public hearings on the application.
The commission emphasized, however, that the approved rate remains provisional and could still be adjusted once the case is resolved. Any excess or deficiency in collections will either be refunded to or recovered from consumers depending on the commission’s final ruling.
In a separate decision, the ERC authorized Meralco to collect approximately P8.7 billion in previously unrecovered pass-through costs accumulated over several years, including around P595 million in system loss charges.
The recovery will be implemented over three years through an additional charge equivalent to P0.08 per kWh.
For a household consuming 200 kWh monthly, the adjustment translates to an additional P16 in every electricity bill.
The approved amount covers under-recoveries in generation, transmission, system loss and real property tax charges from February 2011 to December 2022.
At the same time, the ERC directed Meralco to refund approximately P30.13 million representing excess collections related to lifeline subsidies, senior citizen discounts and local franchise taxes.
ERC Chairman and Chief Executive Officer Francis Saturnino Juan stressed that pass-through charges do not generate profit for distribution utilities.
He explained that these costs are merely collected on behalf of power generators, the transmission provider and government agencies, and are subject to periodic reconciliation through the ERC’s “true-up” process to ensure consumers pay only the actual allowable costs.
“The commission closely verifies every peso collected under these charges to protect consumers from unapproved or excessive billings while ensuring utilities recover only legitimate expenses,” Juan said.
The latest approval comes as Meralco is also preparing to implement an earlier ERC order requiring the utility to refund P9.5 billion in distribution over-recoveries to its more than eight million customers.
The refund, equivalent to P0.5861 per kWh for residential consumers, will be credited to customer bills over a six-month period.
Former Bayan Muna Representative Carlos Zarate criticized the regulator’s twin rulings, describing them as a “bigay-bawi” arrangement that effectively erodes the benefits consumers would receive from the P9.5-billion refund.
According to Zarate, allowing Meralco to recover billions of pesos while simultaneously ordering refunds leaves consumers with little meaningful relief from rising electricity costs.
DOE Eyes 10,000 MW Before 2028
Meanwhile, Energy Secretary Sharon Garin said the government remains on track to add 10,000 megawatts of new power generation capacity before the end of the Marcos administration in 2028.
Garin said about 4,100 MW is targeted for completion this year, while more than 6,600 MW in committed renewable and conventional power projects are being monitored to achieve the administration’s overall capacity expansion program.
The planned additions form part of President Ferdinand Marcos Jr.‘s directive to accelerate the construction of 200 new power plants to strengthen the country’s energy supply and improve long-term power security.
ia/xf
