Millions of electricity consumers in the Visayas and Mindanao could see relief in their bills after the Energy Regulatory Commission ordered the recalculation of power charges following extraordinary prices in the electricity market.
Electricity consumers in the Visayas and Mindanao are set to get a break from soaring power costs after the Energy Regulatory Commission (ERC) ordered the Philippine electricity market operator to retroactively apply a regional price cap for August.
The ERC directed the Independent Electricity Market Operator of the Philippines (IEMOP) to implement the regional Secondary Price Cap (SPC) beginning with the August 2026 billing month.
The move means August 2026 settlements will have to be recalculated, potentially lowering the market-related charges passed on to consumers.
The commission ordered IEMOP to issue recalculated final settlement bills by September 20, while the consumer payment deadline will be moved to September 28.
Distribution utilities have also been instructed to promptly and accurately reflect the recalculated, lower SPC-based charges in customers’ electricity bills.
The order comes as the country grapples with supply constraints that have affected the Visayas and Mindanao power grids.
The ERC said its action was taken under its authority over the Wholesale Electricity Spot Market (WESM) and its mandate under the Electric Power Industry Reform Act of 2001, or EPIRA.
It also follows Executive Order No. 110, Series of 2026, issued by the government amid supply constraints affecting the country’s electricity system.
But the commission’s intervention goes beyond simply cutting charges. It has ordered an investigation into whether the extraordinary prices seen in August were genuinely caused by tight electricity supply — or whether the behavior of power generators contributed to the price spikes.
The Philippine Electricity Market Corporation (PEMC) has been given 30 days to conduct a comprehensive assessment of WESM rules and mechanisms related to sustained high market prices.
Through its Market Surveillance Committee, PEMC must also examine the bidding, offers and dispatch behavior of generating companies in the Visayas and Mindanao during periods when prices breached the cap threshold.
The investigation will look for possible economic withholding, cartelization or other anti-competitive behavior, with a report due within 60 days.
The National Grid Corporation of the Philippines (NGCP), meanwhile, has been ordered to assess how existing grid interconnections can be used more effectively and submit recommendations within 30 days.
The ERC said the investigation is intended to ensure that the market is not being manipulated at the expense of consumers. “Protecting consumers does not mean abandoning the market,” ERC Chairperson Juan said. “It means making sure the market is actually working as intended.”
The chairperson said genuine shortages should still be reflected in electricity prices because generators need to recover their costs.
But if the price signals do not reflect genuine scarcity, the commission said it will take action. “If they reflect anything else, the Commission will act on it,” Juan said, stressing the need to protect consumers while preserving fair competition.
The ERC’s order therefore sends a dual message to the electricity industry: consumers must be protected from extraordinary charges, but legitimate market signals should not be suppressed.
For households and businesses already struggling with high electricity costs, however, the immediate concern is simpler — how much lower their next bill could be.
The ERC said applying the regional SPC retroactively to August means consumers in the affected areas should see actual relief in their electricity bills, rather than merely an acknowledgment of their complaints.
“Our mandate under the EPIRA is unambiguous — to protect the public interest as it is affected by the rates and services of electric utilities,” Juan said.
The commission added that it would continue to act “swiftly, decisively, and within the bounds of the law” as it monitors the electricity market.
The August price episode could now have consequences beyond the immediate reduction in consumers’ bills, with the pending investigation potentially determining whether the extraordinary market prices were the unavoidable result of supply shortages — or evidence that deeper problems exist in the country’s competitive electricity market.
About The Author
