Meralco rates going down this month

MANILA, Philippines — Over eight million Manila Electric Co. (Meralco) customers may see lower electricity bills this month as the utility giant begins rolling out its P9.5-billion refund.

Meralco spokesman Joe Zaldarriaga said the refund, equivalent to P0.59 per kilowatt-hour (kWh) for residential customers, should cushion the impact of other upward adjustments in the month’s billing.

“We are hoping that the downward adjustment will bring relief to Meralco customers, especially with the lower overall demand observed in the Luzon grid,” Zaldarriaga told reporters yesterday.

The Energy Regulatory Commission (ERC) earlier ordered the country’s largest power utility to return P9.5 billion in overcollections to customers over six months.

The refund stemmed from a true-up calculation that reconciled Meralco’s actual weighted average tariff during the 2025 lapsed period with the ERC-approved final distribution rate for the same period.

However, other ERC-approved adjustments will partly offset the refund, including a higher feed-in tariff allowance (FIT-All) and the collection of P8.7 billion in underrecoveries from customers.

The underrecoveries, covering generation and transmission charges, system loss and taxes, will be collected at P0.08 per kWh each month over three years.

Meanwhile, FIT-All, a uniform charge that supports renewable energy projects, will rise to P0.3359 per kWh this month from P0.2011 per kWh.

Adding to the upward pressure, prices of power reserves procured by the National Grid Corp. of the Philippines have also increased significantly, Zaldarriaga said.

Meralco is expected to announce its August rate adjustment today.

BIR urged: Waive VAT on system loss

The Bureau of Internal Revenue (BIR) should lead the way in removing the 12 percent value-added tax on system loss charges, Association of Philippine Electric Cooperatives (APEC) party-list Rep. Sergio Dagooc said.

“Consumers should not be paying VAT on electricity that never even reaches their homes,” Dagooc said, adding that the BIR should do this without waiting for new legislation.

System loss is the electricity lost during transmission and distribution that power companies pass on to customers, but the government charges the standard 12 percent VAT because system loss counts as part of the utility company’s taxable income.

“For the information of the (Department of Energy), I have no objection if consumers are made to pay it. But kindly replace the term line rental because that is an insult to the intellect of the Filipino people. Call it what it really is – a generation charge,” Dagooc said.

Pangasinan 2nd District Rep. Mark Cojuangco compared the issue to the thermal efficiency of a vehicle’s internal combustion engine, where only 30 percent of energy is utilized, with the remainder lost as heat. — Delon Porcalla

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