As Batangas Grows, Its Power Sector Must Evolve
- November 2, 2026
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After years of consumer complaints over recurring brownouts and unreliable electricity service, the Batangas Electric Cooperative II (BATELEC II) is finally moving to open its distribution operations to a private-sector partner.
The electric cooperative’s (EC) board unanimously approved the use of a competitive selection process (CSP) to assess prospective partners before commercial negotiations begin. It also tasked a technical working group with drafting the bidding rules, including eligibility requirements and evaluation criteria.
According to the EC, the process would uphold transparency, fair competition and equal opportunity for bidders, in line with applicable laws and regulations.
(Also read: Super El Niño Threatens Power Supply As Demand Climbs In 2027)
BATELEC II Consumers Push for Meralco Partnership
Earlier in March, around 2,000 residents and business owners in Laiya, San Juan, Batangas, urged BATELEC II to allow Manila Electric Co. (Meralco) to take over electricity service in their community.
Meralco had been vocal in calling on BATELEC II to hold a public bidding for a distribution partner, advancing its proposals to modernize facilities and address persistent power reliability issues in Batangas.
“Our request is really to hasten it because it has been there for a long time; we have been pending,” stated Meralco Senior Vice-President Arnel Casanova.
Apart from disrupting businesses and livelihoods, residents pointed out that power problems also affected students, workers, and households, while holding back the area’s growth.
A petition submitted to BATELEC II detailed five major concerns: frequent unplanned outages, unstable voltage, damaged appliances, poor customer service, and inadequate maintenance of power facilities.
The interruptions typically lasted one to two hours and stretched to three hours, according to the petition. A survey by Capstone Intel also found that 93% of BATELEC II consumers experience multiple power interruptions.
Residents said voltage fluctuations damaged essential equipment, including refrigerators, televisions, and electric fans, adding to the financial burden on households and businesses.
Senior Citizen Party-list Rep. Rodolfo “Ompong” Ordanes also criticized BATELEC II for failing to act on Meralco’s joint venture proposal earlier, saying the delay had prolonged the hardship of Batangas residents, particularly the elderly.
Older people were especially vulnerable to recurring power interruptions, as many relied on electricity for ventilation during extreme heat and to operate essential medical equipment.
“Three years have passed since Meralco submitted its joint venture proposal, yet there has been no action from BATELEC II. The prolonged inaction is unacceptable,” he emphasized.
Power Woes Threaten Batangas’ Tourism Growth
Residents also questioned BATELEC II’s ability to meet Laiya’s rising power demand, warning that unreliable electricity threatens public safety, livelihoods and the area’s tourism-driven growth.
Batangas is one of the Philippines’ leading provincial economies, with a mix of industrial activity, tourism and agriculture. Located in the CALABARZON growth corridor, the province serves as an important hub for manufacturing, logistics and energy infrastructure, alongside its established agricultural and tourism sectors.
In 2025, Batangas’ economy grew by 3.3%, down from 7.0% in 2024, with its gross domestic product (GDP) reaching ₱713.22 billion. It remained one of the country’s largest provincial economies in 2025, contributing 3.1% of national GDP and ranking sixth among provinces and highly urbanized cities by economic output.
Concerns over BATELEC II’s poor service date back at least to 2018, when the Power Watch Movement reported widespread dissatisfaction, with surveys showing 71% of consumers unhappy with the EC’s service. Alleged service deficiencies also drew national attention, prompting then-Senate President Tito Sotto to consider an inquiry into the EC’s 50-year franchise.
By the early 2020s, complaints over recurring outages and aging power facilities had continued, with local officials in towns such as Taysan and Lobo raising concerns about the reliability of electricity service.
Meanwhile, a recent survey also flagged allegations of BATELEC I and II supporting political candidates, as well as complaints of overcharging and insufficient regulatory intervention. The research firm attributed the service problems to alleged mismanagement and chronic underinvestment in infrastructure.
Both cooperatives received customer satisfaction ratings below the provincial average. Many respondents, particularly BATELEC II customers, also expressed willingness to switch electricity providers.
Meralco’s Plan to Improve Power Service
Meralco, which serves more than 8.2 million customers across Metro Manila and nearby provinces, is looking forward to expanding its reach in Batangas.
Casanova clarified that the company’s proposed partnership with BATELEC II would focus on funding infrastructure upgrades rather than taking over the cooperative’s franchise, assets, or operations.
“All other proposals that we see out there require the takeover of the franchise by a new corporation. So basically, the electric cooperative loses the business itself because it’s transferred to a new corporation, and the asset will be transferred to a new corporation,” he explained.
Instead, Meralco wants ECs to retain their assets and franchise while gaining access to capital for modernization. Its model also involves converting cooperatives into stock corporations, allowing member-consumers to become shareholders and potentially receive dividends.
The approach is permitted under the Electric Power Industry Reform Act (EPIRA), which allows ECs to convert into stock cooperatives or stock corporations. Casanova said the change could give members a direct ownership stake in the business while helping fund improvements to electricity service.
Meralco aims to extend reliable electricity service to more communities across Batangas, building on its presence in Sto. Tomas, Batangas City, and San Pascual, where dependable power has supported economic growth.
Recently, system losses have drawn renewed scrutiny following President Ferdinand Marcos Jr.’s call to abolish these charges from electricity bills, spotlighting inefficient ECs that have recorded losses exceeding regulatory limits.
Meralco’s entry could help bring these losses down to single digits, said Casanova. The company currently has one of the lowest system loss rates in the country at 5%, compared with rates of 10% to as high as 25% among other ECs.
“If you are able to lower that to even a single digit, that’s worth billions of pesos in savings for the consumers,” he noted. “You get reliable power, an efficient utility, and cheaper electricity.”
BATELEC II’s system losses remained close to double digits at 9.53% in 2025, while the cooperative’s historical peak reached a much higher 14.82% in 2000.
Meralco could quickly improve power reliability across Batangas by linking the province’s 13 substations to its existing distribution management system. More efficient operations would also lower generation costs for rural ECs and improve affordability for consumers.
(Also read: Philippines Ramps Up Energy Security Drive With Stronger US Partnership)
BATELEC II’s Move Signals Long-Awaited Change
After years of delays surrounding proposals for private-sector involvement, BATELEC II’s adoption of a formal competitive selection framework signals progress toward a potential partnership. The move could pave the way for much-needed investment and expertise to address persistent service issues in Batangas.
The EC said its framework is designed to balance private-sector participation with transparency, regulatory compliance, and member-consumer involvement, while upholding cooperative principles and protecting members’ rights. It also hopes the approach can serve as a reference for other ECs considering similar partnerships.
Meanwhile, Philstar columnist Alex Magno lauded BATELEC II’s move to adopt a competitive selection process, describing strategic partnerships as a way for rural ECs to overcome capital constraints and keep pace with growing energy demand.
“Rural power distributors often do not have the capital required to upgrade their service delivery. The solution to this constraint is to foster strategic partnerships between cooperatives and capital-rich distributor corporations,” he wrote. “This is the only way to go. This is how responsible governance works.”
However, choosing a partner requires transparency and careful evaluation, as the agreement could shape service quality, operating efficiency, future investments and the welfare of hundreds of thousands of member-consumers. Citing past problems involving partnerships in the water sector, Magno warned that closed-door negotiations can invite disputes and costly legal challenges.
By setting clear qualification requirements, technical standards, financial benchmarks and evaluation criteria before selecting a partner, BATELEC II can give member-consumers greater confidence in the process and reduce the risk of contested outcomes.
ECs were established to bring electricity to communities when local needs and economic conditions were vastly different. Today, as industrial investment, tourism, and businesses spread beyond major urban centers, these utilities must adapt to meet growing demand.
For BATELEC II, opening the door to private-sector expertise and capital could be a crucial step toward ensuring that Batangas’ power infrastructure keeps pace with its economic ambitions.
Sources:
https://business.inquirer.net/599045/batelec-ii-sets-public-bidding-for-private-sector-partner
https://businessmirror.com.ph/2026/03/24/residents-seek-meralco-service-in-batangas
https://en.wikipedia.org/wiki/Batangas
https://rsso04a.psa.gov.ph/content/batangas-economy-records-33-percent-growth-2025
https://en.wikipedia.org/wiki/Batangas_II_Electric_Cooperative
https://tribune.net.ph/amp/story/2025/04/25/batangas-residents-lament-electric-coops-poor-services
https://www.manilatimes.net/2026/10/20/opinion/columns/hope-in-the-horizon/2448844
https://mb.com.ph/2026/08/20/meralco-seeks-cooperative-capital-partnerships-to-cut-power-rates
