ERC orders Meralco to refund P9.5 billion to consumers

MANILA, Philippines—Consumers of Manila Electric Co. (Meralco) may realize a modest reprieve from elevated power rates as regulators gave the green light to implement a P9.5-billion refund.

Based on its decision dated July 31, the Energy Regulatory Commission ordered the country’s biggest power distributor to refund the equivalent rate of P0.3449 per kilowatt-hour (kWh) within six months as a separate line item in consumers’ electricity bills.

This decision came after Meralco filed two separate applications for refund last year and early 2026.

“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,” Jose Ronald Valles, SVP and head of regulatory management of Meralco, said in a statement on Sunday.

According to ERC chair and CEO Francis Saturnino Juan, the implementation would begin next billing cycle upon the receipt of the ruling.

Under a rate reset process, a regulated entity, such as Meralco, must submit to the ERC its spending and proposed projects over a period, usually 5 years, unless extended by the regulator. This will then be the basis of the rate that will be passed on to consumers.

The multibillion-peso refund represents the price correction for the lapsed period from January to December 2025.

A lapsed period refers to the duration since the previous rate update, potentially affecting the pricing and revenue of regulated entities, such as Meralco.

During this period, consumers are charged using outdated rates, which may no longer reflect the current costs of the service as the company awaits new tariff adjustments.

“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 of Meralco relative to the instant case,” the ERC said. /apl