Meralco braces for oil fallout, promises to cushion power prices
As tensions in the Middle East threaten to push global fuel prices higher, Manila Electric Company (Meralco) said it is taking steps to manage potential impacts on electricity supply and prices for the more than 27 million people in its service area.
In a statement, Meralco Executive Vice President and Chief Operating Officer Ronnie Aperocho said the utility is implementing measures aimed at limiting disruptions and moderating electricity costs for its customers.
“Amid heightened geopolitical tensions in the Middle East and the potential ripple effects on global fuel markets, Meralco is proactively implementing all necessary measures to shield our customers from possible supply disruptions and upward pressure on electricity prices,” Aperocho said.
Meralco distributes power to about 8.11 million customer accounts across 39 cities and 72 municipalities, including Metro Manila and nearby provinces. Its franchise area accounts for around half of the Philippines’ electricity consumption and a large share of national economic activity, making global energy shocks particularly significant for the country.
According to the company, it is coordinating with its power suppliers and reassessing its sourcing strategy to keep electricity costs as low as possible while ensuring supply reliability.
“We are closely coordinating with our power suppliers to keep generation charges at least cost while prioritizing reliability across our system,” Aperocho said.
He added that Meralco is optimizing its energy mix, limiting exposure to the volatile Wholesale Electricity Spot Market (WESM), and securing lower-cost replacement power when needed.
The measures follow a directive from Meralco Chairman and CEO Manuel V. Pangilinan for the company to undertake a comprehensive review of its fuel sourcing strategy, including its mix of LNG, coal, and other generation sources.
Efficiency push and consumer programs
However, while the company emphasized efforts to cushion consumers from global price volatility, the statement did not specify concrete steps that would guarantee stable electricity rates or prevent increases should fuel prices continue rising.
Under the Philippines’ power pricing framework, generation charges — driven largely by fuel costs — are passed through to consumers, meaning sustained increases in global oil and gas prices could still translate into higher electricity bills.
Industry observers note that if Middle East tensions continue to push up fuel prices, generation charges could face upward pressure in the coming months, even as utilities attempt to moderate the impact through procurement strategies and portfolio management.
Beyond supply measures, Meralco said it is encouraging customers to conserve energy and participate in programs designed to ease pressure on the grid.
The company is expanding participation in the Interruptible Load Program (ILP), which allows large electricity users to run their own generators during supply shortages.
For households, Meralco said it is promoting energy-saving practices and implementing the Lifeline Rate Subsidy Program, which provides discounted electricity rates for low-income consumers using 100 kilowatt-hours or less per month.
“We remain fully committed to facing these uncertainties with care and foresight so Meralco can continue providing reliable power and supporting our customers through these challenging times,” Aperocho said.
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