Meralco Customers See Higher February Rates Despite Lower Generation Costs

Electricity consumers in Metro Manila and nearby provinces will pay higher power bills in February as Manila Electric Co. (Meralco) implemented an upward rate adjustment driven largely by increased transmission and reserve-related charges.

Meralco announced a ₱0.2226 per kilowatt-hour (kWh) increase in electricity rates for February, bringing the overall rate to ₱13.1734 per kWh from ₱12.9508 per kWh in January. For households consuming 200 kWh, this translates to an increase of about ₱45 in their monthly electricity bill.

The adjustment follows back-to-back rate reductions in previous months and reflects movements across several pass-through charges, which Meralco said were outside its direct control.

Transmission Charge Drive Increase

The main contributor to the February rate hike was the transmission charge, which rose by ₱0.1975 per kWh. This increase was attributed to higher ancillary service charges from the Reserve Market incurred by the National Grid Corporation of the Philippines (NGCP), as well as higher power delivery service charges.

Ancillary services refer to regulating and contingency reserves that help maintain grid stability, particularly during supply-demand imbalances or unexpected outages.

“There is also a possible increase in transmission charge due to higher market prices for regulating and contingency reserves,” said Joe Zaldarriaga, Meralco vice president and head of corporate communications.

Other charges, including taxes, posted a net increase of ₱0.0554 per kWh, further contributing to the overall upward adjustment.

Higher Missionary Electrification Charge

February bills also reflect the initial implementation of a higher Universal Charge for Missionary Electrification (UCME), following approval by the Energy Regulatory Commission (ERC). The UCME rose to ₱0.2763 per kWh from ₱0.1993 per kWh previously, adding about ₱0.0770 per kWh to residential bills.

The UCME is collected from all on-grid electricity consumers to subsidize power supply in off-grid and remote areas not connected to the main transmission network.

“That is equivalent to an additional 8 centavos per kWh, to be collected from all on-grid electricity end-users,” Zaldarriaga said.

Lower Generation Charge Cushions Impact

The impact of higher transmission and other charges was partially mitigated by a decline in the generation charge, which fell by ₱0.1073 per kWh to ₱7.6398 per kWh. Lower costs from independent power producers (IPPs) drove the reduction. 

IPP charges dropped by ₱0.8108 per kWh, largely due to the completion of fixed fee collections for the First Gas–Sta. Rita plant following the ERC’s confirmation of the computation method under the interim extension of its contract with Meralco. A decrease in Malampaya natural gas prices after quarterly repricing also contributed.

These reductions offset higher charges from the Wholesale Electricity Spot Market (WESM), which rose by P1.5682 per kWh, and a P0.0483 per kWh increase in charges from power supply agreements (PSAs).

WESM prices increased amid tighter supply conditions in the Luzon grid, with average capacity on outage rising by about 973 megawatts. Planned maintenance shutdowns at Excellent Energy Resources Inc. and South Premiere Power Corp. also reduced PSA dispatch during the supply month, ahead of the seasonal rise in electricity demand during the dry season.

Despite a systemwide drop in average WESM prices in January, spot prices in Luzon increased by about 9 percent month-on-month, adding pressure to generation costs.

Source:

https://www.rappler.com/bulletin-board/advisories/meralco-power-rates-february-2026

https://business.inquirer.net/573268/meralco-power-rates-seen-climbing-in-february-bill

https://www.bworldonline.com/economy/2026/02/04/728584/wesm-prices-decline-in-jan-as-supply-improves