Renewable energy alone will not automatically translate to lower electricity costs unless consumers are given greater freedom to choose their power suppliers, according to Mabuhay Energy Corporation (MECO) President and CEO Jacqueline Castillo.

Speaking during the panel discussion “Beyond Oil Volatility: Renewable Energy as the New Pillar of Energy Security” at the 3rd Solar and Energy Storage Future Philippines 2026 conference in Manila, Castillo said the country’s renewable energy buildout must be accompanied by stronger consumer participation in retail electricity programs if Filipinos are to fully benefit from the energy transition.

While renewable energy projects continue to enter the market, Castillo noted that many consumers remain tied to traditional electricity supply arrangements that are still heavily influenced by coal and liquefied natural gas (LNG) contracts.

“So for example, a distribution utility like Meralco, their supply portfolio is mostly coal, that’s around 20-25% of their supply. LNG is around 50-60%. And RE supply is only 10% of their portfolio,” Castillo said.

She explained that because many of these supply contracts run for 10 to 15 years, the impact of newly commissioned renewable energy facilities may not immediately reach captive customers, or consumers who are required to purchase electricity from their local distribution utility.

According to Castillo, this became especially evident when global fuel prices surged following the Russia-Ukraine conflict.

She said the Philippines’ continued reliance on imported coal and LNG leaves consumers exposed to fuel price volatility and geopolitical risks, even as renewable energy capacity expands.

“The only way to solve this is to shift them towards the retail programs of the government. Otherwise, they remain as a price taker of what their distribution utility wants to give them,” Castillo said.

Retail electricity programs allow qualified consumers to choose their electricity supplier instead of purchasing power solely through their local utility. The system is intended to encourage competition and provide customers with more options for pricing and energy sourcing.

Despite these programs being available for more than a decade, Castillo said a significant portion of eligible consumers have yet to make the switch.

“Basically all the C&I (commercial and industrial) customers right now are already eligible to switch to a retail supplier, but they’re not doing that because of, I guess, the lack of education,” she said.

Castillo added that the conversation around energy procurement has also changed in recent years.

Where businesses once focused primarily on securing the lowest electricity rates, companies are now placing greater importance on supply reliability as energy disruptions increasingly affect operations.

“But now the discussion has shifted to how reliable the supply is,” Castillo said.

She noted that discussions that were previously handled by procurement managers and engineers are now taking place directly with chief executive officers and chief financial officers because energy concerns have become operational risks for many businesses.

To support long-term energy security, Castillo outlined four priorities: faster grid modernization, accelerated renewable energy project development, more stable and forward-looking energy policies, and greater consumer empowerment through retail electricity programs.

She also pointed to government agencies as an untapped opportunity, noting that many remain captive electricity customers despite retail competition programs having existed for around 15 years.

For Castillo, the country’s energy transition will require more than simply building additional renewable power plants.

“Affordability is not just a concern of one sector, but I guess it’s really a concern of the whole value chain,” she said.

How can the Philippines ensure that the benefits of renewable energy reach consumers faster rather than remaining locked behind existing market structures?

Follow Power Philippines on Facebook and LinkedIn or join our Viber community for more news and updates in the Philippine energy sector.