Think tank INFRAWATCH PH has urged the Energy Regulatory Commission (ERC) to resolve the Manila Electric Co. (Meralco) tariff review without further delay, citing its negative impact on customers and investors.
In a statement, Infrawatch said the unresolved rate reset process has deprived Meralco customers of the promised benefits of the performance-based regulation (PBR). The thinktank, led by convenor Terry Ridon, stressed the urgency of concluding the review to allow the utility to move to the next regulatory period, the 6th (6RP), which begins in July 2026.
Ridon urged the regulator in a letter to declare the 5th regulatory period (5RP) as officially lapsed and proceed with the 6RP review. He argued any further delay would undermine the integrity of the PBR which is designed to ensure that rates accurately reflect the cost of delivering electricity while also providing a clear signal to investors.
“This will not only ensure that the benefits promised under the PBR are realized by customers but will also send the appropriate signal for investors to come in,” Ridon said.
The Infrawatch leader pointed out that ERC chairperson Monalisa Dimalanta has publicly confirmed that the 5RP has concluded. Ridon called for a formal order from the ERC to facilitate the transition to the 6RP and prevent any further disruptions in the rate-setting process.
The 5RP tariff review, which began in July 2022, remains unresolved although ERC rules dictate the distribution rate adjustments be made before the regulatory period begins. Under the rules, the ERC is required to determine the revenue requirements for the next four years to account for customer growth, performance standards, and other regulatory factors.
Ridon emphasized that any further delay in the review would jeopardize the timeline for the upcoming 6RP and be detrimental to the legal and financial predictability needed by both the utility and its customers.
Last week, Dimalanta hinted that the ERC may modify its decision on Meralco’s 5RP after receiving additional comments although no specifics were disclosed.
Jose Ronald Valles, Meralco senior vice president and regulatory management head, said if the ERC recognizes the 5RP as lapsed, the utility could refund up to P16 billion to customers due to an overcharge in the approved tariff for the period. Meralco initially requested a rate of P1.57 per kilowatt hour (kWh), but if the 5RP is declared a lapsed period, the rate would be adjusted to P1.3522 per kWh, resulting in a refund to consumers for the difference.
Valles further said that without the recognition of the lapsed period, Meralco customers would be subject to a higher rate of P1.57 per kWh.
