Meralco PowerGen Corporation (MGEN), the power generation arm of Meralco, posted a sharp earnings increase in the first quarter, driven by liquefied natural gas (LNG) assets, higher market sales, and expanding renewable capacity—signaling a shifting energy mix with implications for grid stability and long-term supply security.

In a media briefing on Monday, MGEN reported core net income (CCNI) of PHP 5.1 billion for Q1 2026, up 51% year-on-year, as total energy output rose 25% to 6,626 GWh.

MGEN President and CEO Emmanuel V. Rubio said the growth was underpinned by stronger contributions from its LNG portfolio and improved plant performance.

The company said LNG investments delivered 2,712 GWh during the quarter—66% higher year-on-year—reflecting the first full-quarter contribution of assets under its portfolio. 

Thermal generation and international operations also posted gains, while renewables output climbed 34% to 234 GWh following new solar capacity additions.

MGEN now accounts for 45% of Meralco’s total CCNI—its largest share to date.

Renewables and storage ramp up

The company highlighted rapid progress in its flagship solar and battery projects, positioning them as critical to reducing reliance on imported fuels amid global price volatility.

MTerra Solar, one of the country’s largest integrated solar and battery energy storage system (BESS) projects, delivered up to 250 MW to the Luzon grid by end-March and has reached 83% completion for Phase 1.

“The entry of MTerra Solar to the grid is not just timely but critical as this project lessens our dependence on imported fossil fuels which is subject to price volatility,” Rubio said.

The project’s battery component has already delivered up to 450 MWh of stored energy, with the company noting it represents the largest operational BESS in the Philippines to date.

Meanwhile, MGEN’s Toledo BESS project is nearing completion of its first 25 MW phase, aimed at improving grid stability through fast-response power support.

Market volatility and regulatory response

The company also addressed recent disruptions in the Wholesale Electricity Spot Market (WESM), which was temporarily suspended by the Energy Regulatory Commission in March due to price spikes linked to geopolitical tensions in the Middle East.

“The suspension of the Wholesale Electricity Spot Market (WESM)… reflected a necessary regulatory response to extraordinary market conditions brought about by the Middle East situation,” the company said.

During the suspension, MGEN said it operated its baseload plants at full available capacity to help stabilize supply. The ERC has since lifted the suspension, allowing generators to resume normal market participation.

Nuclear study underway

MGEN also confirmed it has secured a USD 2.8 million grant from the U.S. Trade and Development Agency to study the feasibility of deploying small modular reactors (SMRs) in the Philippines.

The study—part of Meralco’s Nuclear Energy Strategic Transition program—will assess technology options and potential sites, with completion targeted by April 2027.

MGEN said it is strengthening its portfolio through a mix of thermal, LNG, renewables, and emerging technologies to navigate ongoing global energy volatility.

“We remain focused on strengthening self-reliance in support of long-term energy security for the Philippines,” the company stated.

How should the Philippines balance LNG, renewables, and emerging options like nuclear to ensure stable and affordable power?

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