Meralco Bills To Reflect P31-B Power Cost Recovery After ERC Ruling
- January 29, 2026
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Customers of Manila Electric Co. (Meralco) are set to shoulder more than P31 billion in additional charges starting March after the Energy Regulatory Commission (ERC) approved the recovery of costs incurred by four power generation companies due to the termination of their power supply agreements (PSAs) under a “change in circumstances” provision.
In separate orders dated Jan. 26, the ERC authorized San Miguel Group subsidiaries South Premier Power Corp. (SPPC) and San Miguel Energy Corp. (SMEC), Ayala-led ACEN Corp., and Panay Energy Development Corp. (PEDC) to recover a combined P31.34 billion from Meralco customers over recovery periods ranging from 12 to 36 months.
ERC Chairperson and Chief Executive Officer Francis Saturnino Juan said the adjustments would have “minimal” or no overall impact on Meralco’s power rates, noting that the charges have been spread out to soften their effect.
Rate Impact
The ERC approved a total rate impact averaging around P0.28 per kilowatt-hour (kWh), which Juan said Meralco has already been implementing since September 2025 under an earlier change in circumstances (CIC) adjustment. This averaging scheme is set to continue until February 2026.
“Despite the P0.28 per kWh rate impact, which we achieved by stretching the recovery periods for all these adjustments, we are still anticipating that the overall net effect on Meralco’s rates of the CIC adjustments will be minimal or none at all,” Juan said.
To further mitigate the impact on consumers, the ERC directed that the remaining CIC-related charges be implemented beginning March 2026. However, customers will start seeing new charges reflected in their bills as early as March, coinciding with the summer months when electricity demand and rates typically rise due to higher temperatures.
These new charges come on top of about P5.1 billion already being billed to customers following an earlier ERC order allowing an initial tranche of San Miguel’s cost recovery.
Breakdown Of Approved Claims
Under the rulings, SPPC was allowed to recover P15.85 billion, while SMEC may collect P13.36 billion. These amounts will be charged to Meralco customers at P0.1246 per kWh and P0.1051 per kWh, respectively, over a 36-month period starting with the March 2026 billing cycle.
The ERC also approved ACEN’s recovery of P1.75 billion, to be collected at P0.0427 per kWh over 12 months, following the termination of its PSA with Meralco. PEDC, part of the Meralco Group, was authorized to recover P380.62 million, equivalent to P0.0093 per kWh, likewise over a 12-month period.
Collectively, the approved charges translate to an additional P0.2816 per kWh to be collected until the full amounts are recovered.
The ERC orders follow a Supreme Court ruling affirming a Court of Appeals decision that granted SPPC, SMEC, and Meralco’s appeal to increase generation charges in 2022. The courts recognized soaring fuel costs at the time, driven by the Russia-Ukraine war and Indonesia’s coal export ban, as valid grounds for terminating the PSAs and recovering resulting losses.
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