Electricity rates will increase starting January 2025 after the Energy Regulatory Commission (ERC) approves the collection of Php 3.05 billion from households.
Philippine Star reported that, in Luzon and Mindanao, consumers will pay an additional Php 0.124 per kilowatt-hour (kWh) for three months, while Visayas residents will see an increase of Php 0.033 per kWh for six months.
The amount represents the remaining 70% of the recalculated Reserve Trading Amount, which is used to fund transactions in the Wholesale Electricity Spot Market (WESM). The fund ensures power generators and suppliers can meet market requirements for reserve trading, which is essential for maintaining grid stability and reliability.
According to the ERC, the deferred payments arose from a moratorium imposed on March 26, which suspended WESM’s co-optimized energy and reserve billing due to concerns over the approved Price Determination Methodology.
The National Grid Corp. of the Philippines (NGCP) initially pegged the amount to be collected at Php 9.1 billion, but the Independent Electricity Market Operator of the Philippines (IEMOP) recalculated the figure to Php 8.8 billion for February and March.
In May, the ERC allowed the collection of only 30% of the Php 8.8 billion during the moratorium period.
The suspension of payments ended on July 26, enabling the resumption of reserve trading for contracted and merchant plants in the WESM.
After a further recalculation, the ERC ordered IEMOP to adjust the remaining 70% of the March billing, factoring in non-compliance data from the NGCP.
Non-compliance, such as failure to meet reserve capacity requirements, resulted in a Php 725 million deduction from the amount owed by households. This reduced the final balance for collection to Php 3.05 billion.
