The Energy Regulatory Commission (ERC) has directed Manila Electric Co. (Meralco), the Philippines' largest power distributor, to refund P9.5 billion (approximately $156 million USD) to its more than eight million customers. This order, based on a 28-page decision dated July 31, 2026, follows a true-up calculation for a lapsed regulatory period that spanned from January to December 2025. During this period, Meralco collected excess tariffs because it continued to bill customers using legacy tariff structures while new rates were awaiting official review and approval. The ERC's decision includes P496.07 million in interest costs to compensate ratepayers for these unauthorized collections.
The refund will be implemented over a six-month period, or until the full amount is disbursed, and will appear as a separate line item labeled "AWAT (Refund/Collect)" on customers' electricity bills. The average refund rate is P0.3448 per kilowatt-hour (kWh) across all customer classes. Residential customers will receive a higher average refund of P0.5861 per kWh, translating to a reduction of about P117.22 (approximately $1.92) for a typical household consuming 200 kWh per month. Meralco, through its Senior Vice President and Head of Regulatory Management Jose Ronald Valles, has stated it will comply with the ERC's directive, noting that the company itself initiated the applications for the refund's implementation.
This is not the first such refund; Meralco implemented a P40.5 billion refund from March 2021 to May 2023, covering July 2015 to June 2022, and has an ongoing P20 billion refund for July 2022 to December 2024 that began in April 2025. The latest P9.5 billion refund specifically addresses the difference between Meralco's Actual Weighted Average Tariff (AWAT) of P1.5224 per kWh during the 2025 lapsed period and the ERC-approved final distribution rate of P1.3522 per kWh for the same period. The refund ensures that any excess tariffs unintentionally collected by the distribution utility are returned to consumers.
