MANILA, Philippines – Filipino consumers may face another increase in electricity rates next month as the Department of Energy (DOE) warned that rising global fuel prices continue to put upward pressure on power generation costs.
Energy Undersecretary Rowena Guevara said on Monday that electricity rates could increase further in August amid sustained volatility in fuel markets.
“We might see an increase (in power rates),” Guevara said during a media briefing.
The warning comes after the Manila Electric Company (Meralco) implemented a higher residential electricity rate for July 2026, increasing the overall rate for a typical household by P0.3428 per kilowatt-hour (kWh) to P14.8261 per kWh from P14.4833 per kWh in June.
For households consuming 200 kWh monthly, the adjustment translates to an additional P69 in their electricity bill.
Based on Meralco's advisory, customers using up to 200 kWh pay about P14.83 per kWh, while those consuming 201 to 400 kWh pay P15.14 to P15.46 per kWh, and households using 401 kWh or more pay around P16.00 per kWh or higher, depending on their consumption.
Meralco attributed the July increase mainly to higher generation charges, which climbed by P0.1800 per kWh because of rising fuel prices and the scheduled maintenance shutdown of the Malampaya natural gas facility that forced several power plants to temporarily shift to the more expensive liquefied natural gas (LNG).
The company also said electricity sourced through power supply agreements became more expensive due to the continuing conflict in the Middle East, which has affected global energy markets.
Wholesale Electricity Spot Market (WESM) prices likewise increased after Luzon recorded a peak demand of 14,534 megawatts, resulting in tighter power supply conditions and higher spot market prices.
Aside from generation costs, taxes rose by P0.0960 per kWh because LNG imports are subject to the 12-percent value-added tax, unlike Malampaya gas, which is VAT-exempt.
Transmission and other charges also increased by P0.0668 per kWh, further contributing to the higher overall residential electricity rate.
Despite the increase, Meralco emphasized that its distribution charge has remained unchanged since the reduction implemented in August 2022 and stressed that the latest adjustment consists mainly of pass-through charges paid to power suppliers, the grid operator, and the government.
Meralco Senior Vice President and Head of Regulatory Management Jose Ronald V. Valles said the recent increase was driven by higher international fuel prices, peso depreciation, and the country's continued dependence on natural gas to maintain grid reliability rather than by higher charges imposed by the distribution utility.
Valles added that around 50 to 60 percent of Meralco's electricity supply comes from natural gas-fired power plants, warning that reducing their use could jeopardize the stability of the Luzon grid and increase the risk of power shortages.
He also reminded consumers that monthly electricity bills are affected not only by the prevailing power rate but also by individual household consumption, meaning total bills may still increase even when electricity prices remain steady or decline.
— The Summit Express
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