Meralco Customers To Get Power Bill Relief As ERC Approves ₱9.5-Billion Refund
- August 3, 2026
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More than eight million Manila Electric Co. (Meralco) customers are set to receive lower electricity bills beginning in the next billing cycle after the Energy Regulatory Commission (ERC) ordered the country’s largest power distributor to refund ₱9.5 billion in overrecoveries collected during the 2025 lapsed regulatory period.
In a 28-page decision dated July 31, the ERC approved with modifications Meralco’s refund application, directing the company to return the amount over six months instead of the 36-month period it had proposed. The refund, equivalent to an average rate of ₱0.3448 per kilowatt-hour (kWh) across all customer classes, will be reflected as a separate line item labeled “Actual Weighted Average Tariff (AWAT) Refund/Collect” in consumers’ electricity bills.
ERC Chairperson and Chief Executive Officer Francis Saturnino Juan said implementation of the refund would begin in the next billing cycle upon Meralco’s receipt of the commission’s decision.
Residential Customers To Receive Bigger Refunds
Residential consumers are expected to benefit the most from the order, with an estimated refund of ₱0.5861 per kWh. For a typical household consuming 200 kWh per month, this translates to a reduction of about ₱117.22 in monthly electricity charges during the six-month refund period.
The refund stems from the ERC’s true-up calculation for the January to December 2025 lapsed period, during which Meralco’s actual weighted average tariff reached ₱1.5224 per kWh, higher than the commission-approved final distribution rate of ₱1.3522 per kWh.
The ERC said the discrepancy resulted in overrecoveries that must be returned to consumers in accordance with the regulatory framework governing distribution utilities.
The approved refund amount exceeded Meralco’s original application of ₱9.01 billion after the commission included approximately ₱496 million in interest costs.
“Considering that Meralco collected the over-recovery during the regulatory years covered by the lapsed period, the Commission finds it prudent to include the interest cost in the computation of the total refund,” the ERC said in its decision.
Higher AWAT
A lapsed period refers to the interval between approved regulatory rate resets, during which consumers continue paying existing charges while regulators evaluate and approve new tariffs.
Under the rate reset process, regulated utilities such as Meralco submit their projected expenditures and investment plans to the ERC. These proposals serve as the basis for determining the distribution rates that may be passed on to consumers.
During the time regulators are reviewing these applications, customers continue paying existing rates, which may no longer reflect the utility’s approved cost structure. The true-up mechanism reconciles the difference between the actual tariffs collected and the rates eventually approved by the ERC, ensuring that excess collections are refunded or, when warranted, additional collections are authorized.
According to Meralco, higher electricity consumption among residential customers during the 2025 lapsed period contributed to the higher actual weighted average tariff.
“The AWAT of Meralco was higher than the approved tariff at those times because of much higher consumption from residential customers compared to other customer classes, which drove Meralco’s AWAT to increase,” said Jose Ronald Valles, Meralco senior vice president and head of regulatory management.
Meralco Vows Compliance
Meralco said it would fully comply with the ERC’s order, noting that the company itself initiated the refund applications in accordance with regulatory requirements.
“Meralco supports initiatives of the government to provide relief to consumers and ensure that they benefit from any approved refund as quickly and transparently as possible,” Valles said.
The company also emphasized that the applications it filed sought refunds rather than additional collections, in compliance with the ERC’s directives.
The utility serves around 8.3 million customers across Metro Manila and nearby provinces, making it the country’s largest electricity distribution company.
Scrutiny Over Electricity Bills
The ERC’s refund order comes as electricity rates remain under close public scrutiny following Meralco’s recent rate increases.
In July, Meralco raised its overall electricity rate by ₱0.3428 per kWh to ₱14.8261 per kWh, citing higher fuel costs and the weakening of the peso against the US dollar, both of which affected generation charges that account for more than half of consumers’ electricity bills.
The increase triggered public criticism, particularly on social media, with consumers questioning several bill components, including charges related to the lifeline rate program, senior citizen discounts and renewable energy initiatives.
Regulators have maintained that these charges are imposed in accordance with existing laws and policies, while Meralco has said fluctuations in generation charges are beyond the company’s control because they are driven by fuel prices and foreign exchange movements.
Amid mounting public concern, the Department of Energy (DOE), together with the ERC, earlier announced a comprehensive review of Meralco’s electricity pricing structure to determine whether consumers are being charged fairly.
Senate President Sherwin Gatchalian also urged the ERC to closely monitor distribution utilities and electric cooperatives to ensure that systems loss charges are not embedded under different billing items should proposals to abolish the controversial fee eventually take effect.
The ERC noted that other distribution utilities also have pending true-up applications, indicating that similar refund or collection adjustments may be implemented as regulators complete their reviews.
Source:
https://newsinfo.inquirer.net/2275767/erc-orders-p9-5-b-refund-to-meralco-customers
