Lower January power prices amid weaker demand, IEMOP reports

Wholesale electricity prices fell nationwide in January 2026, driven by lower demand and wider supply margins in Visayas and Mindanao, even as Luzon prices edged up due to tighter supply conditions, the Independent Electricity Market Operator of the Philippines (IEMOP) said.

For the January 2026 billing period, covering December 26, 2025 to January 25, 2026, the system-wide average price dropped to PHP 3.56 per kilowatt-hour, which is lower from PHP 4.38 in December. The decline came as demand fell faster than supply, easing price pressures in most regions.

System-wide average supply declined to 19,152 megawatts during the period, while average demand fell to 12,492 megawatts. Rica Cagnayo, energy market analyst of IEMOP, said the sharper drop in demand helped pull prices down overall. “Even though supply went down, demand went down more, which resulted in wider margins,” she said.

Prices in Visayas and Mindanao showed the sharpest declines. Average prices in Visayas fell to PHP 4.24 per kilowatt-hour from PHP 7.22, while Mindanao prices dropped to PHP 4.27 from PHP 7.82. This reflects improved supply conditions in both regions.

Cagnayo said wider margins played a key role in the sharper price drops outside Luzon. “We saw better availability of supply in Visayas and Mindanao, which helped pull down prices,” she said.

In contrast, prices in Luzon increased despite lower demand. The average Luzon price rose to PHP 3.25 per kilowatt-hour from PHP 2.98 in December, as supply fell faster than demand, resulting in tighter margins during the month.

Cagnayo said outages contributed to the tighter supply situation in Luzon. “The reduction in available capacity led to a tighter margin, which pushed prices up,” she said, noting that the price movement was driven by short-term conditions.

IEMOP vice president for trading operations Isidro “Sid” Cacho Jr. said plant outages also led to yellow alerts during the period, particularly in Visayas. “These alerts were mostly due to forced outages, which temporarily reduced available capacity,” he said.

Cacho added that overall market activity slowed during the month as prices declined. The effective spot settlement price dropped to PHP 3.97 per kilowatt-hour from PHP 5.52 in December, while total trading amount fell to PHP 11.15 billion from PHP 14.20 billion. “Lower prices naturally resulted in lower trading amounts,” he explained.

Despite the price movements, IEMOP said overall supply conditions remained manageable. Cacho said the trends seen in January reflected operational issues rather than a broad supply shortage. “What we’re seeing are short-term factors affecting the market,” he said.

As electricity prices continue to vary across regions, will supply conditions remain the main driver of monthly power price movements in the coming months?

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