19/05/2026
25 years of EPIRA is enough: PH electricity rates remain one of Asia’s highest as law strengthens monopolies in the power industry
Philippine electricity rates are the third-highest in Asia and the second-highest in Southeast Asia because of neoliberal government policies that privatized the power industry and allowed pass-through charges, as well as onerous taxes imposed on electricity consumers.
Based on data compiled by the website Statbase, the Philippines ranked behind Cyprus (most expensive) and Singapore and Japan (tied for second) in terms of household electricity rates, as of 2026. The country has higher electricity rates than the more developed Asian economies, such as Hong Kong, South Korea, and China.
The privatization of the power industry is primarily to blame for the country's exorbitant electricity rates. The 25-year-old Electric Power Industry Reform Act (EPIRA) merely transferred the industry's monopoly from the state to a handful of oligarchs who control both power generation and distribution. EPIRA, in fact, allowed companies like Meralco to expand their monopoly from electricity distribution to power generation, at the expense of consumers. Manny V. Pangilinan’s Metro Pacific Investments Corp. (MPIC) and the Gokongwei family’s JG Summit Holdings control over 85% of the power distribution giant. They also own major power generation companies, such as the Meralco PowerGen Corporation (MGEN) and MGEN Renewable Energy, which maintain power supply agreements with Meralco. Meralco, through its franchise area, ensures a guaranteed market for MGEN-produced power. Such monopoly control allows MPIC and JG Summit Holdings to squeeze consumers dry through high electricity rates.
Worst, EPIRA ensures that the power companies are protected from risks associated with their operation. MGEN relies heavily on imported coal to generate power for Meralco and operates its own coal trading subsidiary, Global Trade Energy Resources Corp. (GTRADE). The fluctuating global market price of coal due to geopolitical crises, supply chain bottlenecks, or currency depreciation, is considered a pass-through cost. It means that MGEN simply passes the increased cost of imported coal to Meralco, which then passes the bill on to end consumers.
EPIRA also allows Meralco and other power distribution firms to pass on to the consumers the cost of their inefficiency through the System Loss Charge. System loss refers to electricity lost due to aging infrastructure, pilferage, and administrative errors, among other causes. System loss charge means consumers are paying for electricity they did not use, thereby not only absolving distribution companies of accountability, but also rewarding them for failing to upgrade or modernize their infrastructure or to address pilferage.
The heavy burden that EPIRA imposes on consumers is further compounded by the onerous taxes and fees the government levies on electricity use. The 12% value-added tax (VAT), for example, is not a single tax applied once to consumers’ monthly electricity bill, but is levied separately on the Generation Charge, Transmission Charge, Distribution Charge, Metering and Supply Charges, and even the System Loss Charge (a tax on unused electricity). EPIRA also institutionalized a cross-subsidy scheme in which electricity consumers themselves, rather than the government, subsidize the electricity consumption of low-income households using minimal power (e.g., under 20-50 kWh per month). Aside from the subsidy for poor households, the government also passed on to electricity consumers the costs of providing electricity to far-flung, off-grid islands and rural areas (missionary electrification), the cost of promoting renewable energy, and even the discounts for senior citizens.
EPIRA is fundamentally flawed. In the past 25 years, it has only served the interests of the local oligarchs who control the power sector and their foreign partners and funders. We reiterate our demand that EPIRA must be repealed and that the privatization of the power industry be reversed. Energy policy must move away from treating power as a purely corporate venture. Instead, the state must reclaim the power sector in the public interest, which also entails removing onerous taxes and fees from consumers’ monthly electricity bills. # # #