ERC orders Meralco to refund customers P9.5 billion over 6 months
MANILA, Philippines – More than eight million Manila Electric Company (Meralco) customers are set to receive a combined P9.51 billion refund after the Energy Regulatory Commission (ERC) determined that the power distributor collected more revenue than it was entitled to during 2025.
The refund will be credited to customers’ bills over six months at an average rate of P0.3448 per kilowatt-hour (kWh) across all customer classes.
Residential customers will receive a refund of P0.5861 for every kilowatt-hour they consume, meaning the actual amount will vary depending on monthly usage. A household consuming 200 kWh, for instance, would receive a bill reduction of about P117.22 for that month.
The ERC decision was made public on Sunday, August 2.
In a statement, Meralco said it would “comply with the most recent directive of the ERC to implement the refund.”
The refund arose from a regulatory reconciliation of Meralco’s actual weighted average tariff, or the average distribution rate collected from different customer classes, against its approved tariff.
Meralco said residential consumption accounted for a larger share of electricity sales than expected, pushing the weighted average tariff above the approved level. This resulted in Meralco collecting P9.51 billion more than the approved amount, which the ERC ordered to be returned to customers.
This will appear as a separate line item in the bills to customers during the refund period using the term “AWAT (Refund)/Collect.”
The refund comes as the ERC evaluates Meralco’s separate rate-reset application, with a decision expected by late August or September that could either raise or lower the utility’s distribution charges.
Meralco’s challenges
The refund adds to growing scrutiny of Meralco’s electricity charges following President Ferdinand Marcos Jr.’s push to remove system loss charges and the corresponding value-added tax from consumers’ monthly bills.
During his State of the Nation Address on July 27, Marcos called for the immediate amendment of the Electric Power Industry Reform Act, arguing that consumers should not have to pay for electricity lost before it reaches their homes and businesses.
System loss refers to electricity lost while passing through wires, transformers, and other equipment, as well as losses caused by power theft, illegal connections, defective meters, and billing errors. The charge currently accounts for around 5% of the average Meralco bill. (READ: EXPLAINER: What is system loss, and how does it affect your power bill?)
Meralco chairman Manuel V. Pangilinan has warned that the Philippine power industry “may not survive” if utilities and other industry players are forced to shoulder the full cost.
“So, who is going to pay for that? The industry? It’s going to cost tens of billions of pesos. We will not survive,” Pangilinan said. – Rappler.com
