Manila Electric Co. (Meralco) saw its market value drop by $2 billion after President Ferdinand R. Marcos Jr. proposed removing system loss charges from consumer electricity bills. The company's shares fell 4.66% to P562, making it the main index laggard. This decline followed the President's public push for utilities to absorb these costs, a move aimed at lowering electricity prices for consumers.
Meralco Chairman Manny V. Pangilinan warned that the Philippine power industry "may not survive" if utilities are forced to absorb these system loss costs, which he estimates could be in the tens of billions of pesos. He emphasized that system losses are inherent in electricity delivery and questioned who would bear these costs if not consumers. Pangilinan expressed willingness to discuss the matter with President Marcos, noting that Meralco's distribution rate has been unchanged since July 2015 and that recent bill increases came from other parts of the power supply chain.
Despite Pangilinan's strong warning, Meralco's financial performance remains robust. The company reported a 16% increase in gross revenue to P283.7 billion in the first half of 2026, with core net income climbing 3.8% to P26.5 billion. It also posted a record P50.6 billion in core profit in 2025. Analysts suggest that Pangilinan's warning might be a negotiating tactic rather than an immediate forecast of corporate collapse, especially given that the Energy Regulatory Commission is expected to decide on a potential rate reset for Meralco's distribution charge by August or September. The Department of Energy estimates that fully eliminating the system loss charge could take about a year due to necessary infrastructure upgrades and regulatory adjustments.
