Manila Electric Company (Meralco) has announced an increase in electricity rates for February 2026, after two consecutive months of reductions, because of higher transmission and government-mandated charges.

Meralco said the adjustment amounts to PHP 0.2226 per kilowatt-hour, which brings the overall residential rate to PHP 13.1734 per kWh from PHP 12.9508 per kWh in January. For scale, this would be equivalent to a PHP 45 increase in the electric bill for households consuming 200 kWh.

The company said the main factor of the increase was the higher transmission charge, which rose by PHP 0.1975 per kWh for residential customers. This was attributed to increased ancillary service charges from the Reserve Market incurred by the National Grid Corporation of the Philippines (NGCP), with higher power delivery service charges also contributing.

The Reserve Market refers to where NGCP acquires standby power to keep the grid stable during plant outages or sudden demand spikes. Costs from this market are passed down through transmission charges.

Another contributor was the increase in the Universal Charge for Missionary Electrification (UCME), which went up by PHP 0.0770 per kWh following the approval by the Energy Regulatory Commission of a new rate of PHP 0.2763 per kWh, up from PHP 0.1993 per kWh previously.

UCME is collected from all on-grid electricity users to subsidize power costs in off-grid and island areas where electricity generation is more expensive and there are typically less consumers- which also leads to higher electric bills per household.

Other charges, including taxes, also posted a net increase of PHP 0.0554 per kWh, adding to the overall upward adjustment for the month.

The increase was partially balanced out by a lower generation charge, which declined by PHP 0.1073 per kWh to PHP 7.6398 per kWh. This was mainly due to reduced costs from independent power producers.

Independent Power Producers (IPPs) are private power plants that sell electricity to Meralco under contracts, separate from the spot market and government-owned generators.

Meralco said IPP charges fell largely due to lower fixed fees from First Gas-Sta. Rita following the completion of collections related to an ERC-approved computation method, as well as lower Malampaya natural gas prices from quarterly repricing. These reductions offset higher charges from the Wholesale Electricity Spot Market (WESM) and power supply agreements.

WESM charges increased due to tighter supply conditions in the Luzon grid, with average capacity on outage rising by about 973 megawatts. PSA charges, on the other hand, went up due to lower dispatch during the planned maintenance shutdown of Excellent Energy Resources Inc. and South Premiere Power Corp.

Meralco emphasized that its distribution charge remains unchanged, noting that it has not moved since the PHP 0.0360 per kWh reduction implemented in August 2022. Most of the February increase, the utility said, came from pass-through charges paid to suppliers, the grid operator, and government agencies.

Separately, Meralco confirmed that the ERC has approved a uniform national lifeline subsidy for marginalized and low-income households. Qualified customers consuming 50 kWh or less will receive a 100% discount on their electricity rates starting April 2026, while a uniform lifeline subsidy rate of PHP 0.01 per kWh will take effect in March billing.

“We welcome this directive from the ERC which we hope will provide additional relief to our qualified customers,” said Meralco Vice President and Head of Corporate Communications Joe R. Zaldarriaga.

As the dry season approaches, Meralco also reminded customers to manage their electricity use as demand typically spikes during the hotter months. “We reiterate our call for customers to practice energy efficiency as we approach the dry season,” Zaldarriaga concluded.

How will higher transmission and universal charges affect household electricity budgets as summer demand begins to climb?

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