Photo credit: Meralco

The Philippine Rural Electric Cooperatives Association (PHILRECA) and Meralco have responded to recent comparisons between electric cooperatives (ECs) and private distribution utilities (DUs), stressing that affordability and reliable service go hand in hand.

PHILRECA emphasized that while some ECs face operational challenges, most meet government standards and provide affordable electricity to over 16 million member-owner-consumers (MCOs). In 2024, 12 ECs achieved full coverage, and 80 reached 90–99% energization.

It also highlighted the awards recognizing ECs for financial stability, technical excellence, and low system loss. ECs continue to invest in disaster-resilient infrastructure, diversify their power supply including renewable energy, and maintain low Distribution, Supply, and Metering (DSM) charges.

PHILRECA asserted that ECs have proven that low rates and quality service are not mutually exclusive.

It called for transparency as the country transitions to cleaner fuels like liquefied natural gas (LNG), which could raise generation costs.

The association also criticized biased comparisons that portray ECs as “inferior” to private utilities, calling such analogies misleading.

Meralco, meanwhile, emphasized that its rates undergo a stringent review, approval, and confirmation process by the Energy Regulatory Commission (ERC) to ensure they are fair and reasonable.

The company highlighted that Its distribution charge has remained unchanged for the past ten years and is among the lowest in the country, placing it in the bottom 30% of all electricity distributors, including ECs.

Meralco noted that its latest approved Weighted Average Cost of Capital (WACC) is also the lowest granted by ERC among private distribution utilities (DUs). But, despite these low rates, Meralco asserted that it has consistently provided high levels of energy security, reliability, and operational efficiency, and continuously improves these performance parameters year after year.

In terms of power supply, Meralco said it sources its electricity from a diversified mix of gas-fired, coal-fired, and renewable energy plants. About 50% of its supply comes from gas-fired power plants to supplement the growing demand in its franchise area, especially given the current limitations on coal-fired capacity due to the coal moratorium. This diversified approach ensures sufficient, stable, and reliable power for its over 8 million customers, supporting government policies on grid security and helping prevent Red and Yellow alerts nationwide.

On suggestions that Meralco’s rates be reduced to match those of ECs, many of which rely primarily on cheaper coal-fired power, Meralco explained that doing so would effectively call for repealing the recently enacted Natural Gas Law (RA No. 12120) and reversing government plans to expand gas-fired power capacity, which is a critical part of the nation’s energy transition. It added that doing so would also risk slowing the country’s progress toward renewable energy targets of 35% by 2030 and 50% by 2040.

Meralco assured that it fully supports the government’s transition to cleaner fuels, recognizing the importance of balancing environmental goals with affordability and reliable supply.

The company said the increase in total electricity rates since 2024 is primarily due to market factors and generation costs, not Meralco’s distribution charge. The company said it operates without relying on taxpayer money or government funding and remains committed to delivering service that ensures long-term stability, energy security, and support for economic growth.