Manila Electric Co. chairman Manuel V. Pangilinan said the country’s largest power distributor is reviewing its fuel mix as tensions in the Middle East threaten to push electricity costs higher.
Global energy markets have been rattled after the US launched an airstrike against Iran, prompting retaliatory moves against Israel and other American allies hosting US military installations. Crude prices have since surged, reviving fears of another round of fuel-driven inflation.
“Meralco will review its current fuel position—especially LNG, the likely impact on the price of coal, the price of diesel—as these may affect price of power prices,” Pangilinan said in a post on X, signaling a proactive stance to cushion consumers from volatility.
While the Philippines hardly uses bunker fuel to generate electricity, fossil fuels such as liquefied natural gas (LNG) and coal remain benchmarked to crude oil prices. That linkage means any spike in oil can cascade through power generation costs, even if oil itself is not directly burned in significant volumes.
The country now sources a significant share of its electricity from renewable energy, including hydro, geothermal and solar. But industry officials acknowledge this capacity is still not enough to fully replace fossil fuels, which are largely imported and remain central to baseload supply.
Meralco sources power from coal-fired, natural gas and renewable plants, passing generation charges directly to customers. Sustained increases in global fuel benchmarks could pressure monthly bills if utilities fail to hedge or rebalance supply contracts, underscoring how geopolitical shocks quickly ripple into Filipino households’ electricity costs.
