The Department of Energy (DOE) is calling on all electric distribution utilities (DUs) and electric cooperatives (ECs) across the country to strengthen efforts in balancing energy security with affordability for consumers, underscoring the critical role of cost-effective electricity in national energy policy.
Energy Secretary Raphael Lotilla issued the challenge during the Giga Summit 2025 hosted by Manila Electric Co. (Meralco) in Makati City, emphasizing that affordability must be central in power sourcing and distribution decisions.
“Meralco and other distribution utilities must internalize their responsibilities to the public beyond the borders of their franchise areas,” Lotilla said, urging stakeholders to confront the dual challenges of energy security and consumer affordability.
As the country’s largest distribution utility, Meralco’s influence extends well beyond its 7.8 million customers across 39 cities and 72 municipalities. Its franchise area accounts for nearly 9,000 megawatts (MW) in peak power demand — nearly half the country’s total and 70 percent of Luzon’s.
The DOE said that despite Meralco’s scale and growing presence in power generation — both conventional and renewable — its electricity rates remain less competitive than some smaller DUs and ECs. Lotilla said this warrants a deeper examination of the trade-offs between market consolidation and competition.
“This is a continuing conversation between policymakers, regulators, and Meralco,” Lotilla said. “We need to rigorously assess whether the benefits of economies of scale are truly being passed on to consumers.”
He added that Meralco’s choices in power contracting not only shape the regional energy mix but also influence what resources remain available for other, smaller utilities.
In response, Meralco chairman Manuel Pangilinan acknowledged the criticism. “We are mindful of that. We don’t profit from generation, but we bear much of the criticism. It is in our interest to bring rates down, especially on the distribution side,” he said, assuring efforts are underway to explore cost-lowering measures.
While calling for reform, Lotilla also praised Meralco’s investments in technology for disaster resilience and its growing push into renewable energy, emphasizing that innovation and sustainability remain key to future affordability.
The DOE, alongside the Energy Regulatory Commission and the Philippine Competition Commission, pledged to closely monitor the sector and pursue fair competition and consumer protection—not with suspicion, Lotilla said, “but with the diligence our public deserves.”
