Meralco ordered to refund P2.64 billion to customers

MANILA —  The Energy Regulatory Commission (ERC) has ordered Meralco to refund P2.64 billion to customers.

On average, the refund amounts to P0.1020/kWh, to be refunded over 6 months. The ERC said the refund should be reflected as a separate line item on electric bills.

In a statement, the ERC explained that it regularly checks whether the distribution rates Meralco charges match what it is allowed to collect, based on its real revenues and electricity sales.

Meralco’s approved distribution rate is at P1.3522/kWh. From January to June this year, Meralco charged P1.5537/kWh. This is about P0.20/kWh higher than the approved rate.

The refund rate differs by customers, as follows, the ERC said. 

“Residential and General Service A customers, along with flat streetlight accounts, will receive the highest refund rates, meaning the largest reduction in their monthly bills relative to their consumption,” the regulator said. 

The ERC said Meralco proposed to give out the refunds over 12 months, but the commission decided to shorten the refund period to give customers more relief as power costs remain high.

“When Meralco collects more than what it is entitled to, the ERC will make sure it is returned, and that it is returned quickly,” said ERC Commissioner Francis Saturnino Juan.

In August, the ERC also ordered Meralco to refund P9.5 billion to its consumers.

The refund order will temporarily temper the increase in distribution charge for Meralco also approved by the ERC.

After more than a decade, Meralco’s approved interim distribution rate of P1.35/kwh will go up to P1.48/kwh on the average, or an increase of around P0.15/kwh.

In terms of absolute amount, the regulator slashed P190 billion, or 36 percent of Meralco’s petition to have a P532 billion total revenue requirement from now until 2030.

Meralco sought an upward adjustment of P2.34/kwh to generate P532 billion in revenues to fund various projects but the erc only allowed a distribution rate of P1.48/kwh for this much-awaited rate reset.

Meralco said it has yet to receive a copy of the decision.

“Nonetheless, we believe that this will allow Meralco to move forward with greater clarity as we pursue investments and initiatives to modernize our distribution network and enhance service delivery,” said Atty. Jose Ronald Valles, Meralco’s SVP and Head of Regulatory Management.