Transmission bottlenecks and widespread plant outages drove price increases in the Visayas and Mindanao power markets in December 2025, offsetting easing conditions in Luzon despite improved system-wide supply, data from the Independent Electricity Market Operator of the Philippines (IEMOP) showed.

While national supply increased and demand declined during the month, operating conditions varied across regions. Luzon benefited from looser supply-demand balances, but tighter conditions in the Visayas and Mindanao pushed prices higher.

A key factor was limited power transfers from Luzon to the Visayas through the Leyte–Luzon high-voltage direct current (HVDC) interconnection. This connection normally allows lower-cost Luzon generation to support the central grid. However, in December, the HVDC link was either operating at its maximum transfer limit or offline for 69% of the billing period, higher than the 34% recorded in November, thus restricting access to cheaper supply.

Plant outages further tightened regional conditions. In the Visayas, IEMOP recorded 238 megawatts (MW) of planned coal plant outages and 110 MW of forced outages across various technologies. In Mindanao, unavailable capacity was worse, with 699 MW of coal and hydro capacity offline, alongside 257 MW of forced outages from other generating sources.

With baseload generation being problematic,  higher-marginal-cost units were dispatched more frequently. IEMOP said Battery Energy Storage Systems (BESS) and other higher-marginal-cost units were used more often during peak and constrained periods, pushing prices in the Visayas and Mindanao to as high as PHP 7.86 to PHP 8.53 per kilowatt-hour.

Reserve conditions also added to price pressure. The Visayas experienced shortages in dispatchable reserves, while Mindanao faced deficits in both regulating and dispatchable reserves, contributing to elevated market clearing prices during stressed intervals.

Within the Visayas grid, additional constraints along the 230-kilovolt Leyte–Cebu transmission corridor limited internal power transfers. This resulted in localized price separation, particularly affecting trading nodes in Leyte, where prices rose above regional averages.

Toward the end of the December billing period, operating conditions improved as generation availability increased and key transmission constraints lessened. Prices in the Visayas and Mindanao declined to around PHP 3.08 to PHP 3.21 per kilowatt-hour during the final week of the month.

Despite the late-month easing, sustained price pressure earlier in December triggered the Secondary Price Cap, which was activated for 213 intervals in the Visayas and 216 intervals in Mindanao, keeping monthly average prices elevated.

The December data showcases how regional transmission limits and plant outages can outweigh national supply improvements, shaping electricity prices even when overall system conditions appear to be improving.

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