The Energy Regulatory Commission (ERC) has begun reviewing Manila Electric Company’s (Meralco) proposed distribution rates for 2027 to 2030, starting with a public hearing and expository presentation held last Tuesday (March 3, 2026).

The hearing forms part of the regulator’s review process before any proposed rate adjustments are applied. It also allows stakeholders and consumer groups to review the proposal and ask any questions before the ERC renders a final decision.

During the session, Meralco presented its proposed Maximum Average Price (MAP) for 2027, which sets the average cap for the utility’s distribution-related charges. The company is seeking approval for a MAP of PHP 2.3436 per kilowatt-hour (kWh).

The proposed rate is made up of the following: PHP 1.8142 per kWh for distribution charges, PHP 0.2705 per kWh for supply charges, and PHP 0.2589 per kWh for metering charges. These new charges would apply to residential, commercial, and industrial customers.

Meralco said that the proposed rates take into account future investments in network capacity, technology upgrades, and service improvements. The application was filed under the ERC’s rules governing how distribution utilities set their distribution wheeling rates.

The proposal also includes a Performance Incentive Scheme, which is a built-in framework to either reward or penalize the utility depending on certain service indicators. These would include the frequency of power interruptions, system losses, and response times for customer services, such as new electricity connections and customer calls.

In addition to this scheme, Meralco also proposed maintaining Guaranteed Service Levels, which allow customers to receive compensation if the utility fails to meet minimum service standards.

ERC Chairperson and CEO Atty. Francis Saturnino C. Juan said that the review process is meant to balance consumer protection with the utility’s need for reliable operations. “This process ensures transparency and protects consumers while supporting the utility’s reliable operations,” he said.

The commission said it may approve, modify, or disallow certain portions of the application if some costs are found to be excessive, unsupported, or not aligned with service improvement commitments.

The next hearing, which will include pre-trial conferences, is scheduled for March 10, 2026.

How closely should regulators scrutinize proposed distribution charges that ultimately form part of consumers’ electricity bills?

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