ERC rate review for Meralco faces delay

POWER DISTRIBUTOR Manila Electric Co. (Meralco) may have to wait further before the Energy Regulatory Commission (ERC) issues approval for its proposed capital spending plan through 2030, with the regulator saying it needs more time to complete its review.

ERC Chairman and Chief Executive Officer Francis Saturnino C. Juan said he hopes to release the results of the rate review for the first entry group of privately-owned electricity distribution utilities this month, though he hedged by saying the outcome could be known later.

“We’re still targeting within the month, but a more realistic timeline will be in July,” Mr. Juan said via Viber, referring to the likely release date for the review results of most of the first entry group, excluding Meralco, whose results could be released as late as September.

Meralco is among the first group of distribution utilities to undergo the transition to the first regulatory period, a five-year span for which the ERC reviews a utility’s costs, investments, and performance to adjust its rates if needed.

The first entry group includes Cagayan Electric Power & Light Co., Inc., Cotabato Light & Power Co., Inc., Dagupan Electric Corp., and Meralco, with the review period covering July 1, 2026 to June 30, 2030.

“For Meralco, it may take one to two months after July because the coverage is really extensive, so more time is needed to conduct a thorough evaluation,” Mr. Juan said.

Jose Ronald V. Valles, Meralco’s head of regulatory affairs, told a briefing last month that the company is expecting the ERC to release its decision by June after filing an application in February.

In its application, Meralco proposed a capital expenditure (capex) program of P272 billion for 2027 to 2030. It is also seeking a total revenue requirement of P532.12 billion over the same period.

The power distributor said the capex budget is allocated for programs that will support customer growth, improve system reliability and power quality, and address emerging network requirements.

To help fund its capex program, Meralco is applying for an average distribution tariff of P2.34 per kilowatt-hour (kWh), against its current rate of P1.35 per kWh.

Meralco is the country’s largest private electric distribution utility, serving more than 8.1 million customers in Metro Manila and nearby provinces, including Bulacan, Cavite, Rizal, and parts of Laguna, Batangas, Pampanga, and Quezon.

Meralco’s controlling shareholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera