04/08/2026
Former Bayan Muna Rep. Carlos Zarate Slams ERC’s 'Bigay-Bawi' Scheme as Regulatory Capture, Demands Audit of Meralco's Rate-Setting and Replacement of EPIRA
Former Bayan Muna Representative Carlos Isagani Zarate today slammed the Energy Regulatory Commission (ERC) for a "bigay-bawi" scheme that leaves Meralco consumers with virtually no real relief, charging that the regulator's twin decisions reek of regulatory capture and anti-consumer bias.
On July 31, the ERC ordered Manila Electric Co. (Meralco) to refund ₱9.5 billion—equivalent to ₱0.3448 per kilowatt-hour over six months—to its 8.3 million customers. However, in a separate order on Meralco's over- and under-recoveries, the ERC allowed the power utility to collect approximately ₱8 billion in new charges from the exact same consumers.
"Parang bigay-bawi lang ang ERC. This smells of regulatory capture," Zarate said. "Sa isang kamay, nagmumukhang tulong ang ₱9.5-billion refund. Sa kabila naman, pinapayagan nilang singilin ulit ng Meralco ang halos ₱8 billion sa mga konsumer. Ano nga bang silbi ng refund kung babawiin din pala sa ating mga bulsa?"
"Sabihin man ng ERC na sa August billing ay P0.59/kwh ang bawas sa singil at P0.08 lang ang dagdag ay 3 taon naman ang P0.08 na dagdag sa singil sa kuryente,"he added.
Zarate pointed out that the net relief for consumers amounts to barely ₱1.5 billion—pennies compared to the chronic burden of skyrocketing electricity rates that has been imposed on millions of Filipino households.
"Hindi dapat tayo magpaloko sa numbers game na ito. This makes it appear consumers are being protected, but the reality is that Meralco is being allowed to recover billions more. This is not regulation—this is pandering to the whims of the power oligarchs," he added.
Zarate sharply criticized the ERC’s Performance-Based Regulation (PBR) framework, calling its rate-setting mechanism fundamentally flawed, questionable, and anti-consumer. Under this system, Meralco is allowed to regularly make over-collections running into billions of pesos annually, which are only addressed years later through delayed ERC refund orders.
"This current refund order is already the fifth one since 2001. That means even in the years a refund was being issued, Meralco was continuously over-collecting billions more from consumers," Zarate stressed. "While the ERC is dilly-dallying on fixing Meralco's reset rates, the utility amasses billions in revenues at the direct expense of captive electricity consumers."
Zarate also urged immediate public scrutiny of the ₱8-billion under-recovery order, rejecting claims that pass-through charges yield no financial benefit for the distribution utility.
"It is deceptive to claim that Meralco does not benefit from these pass-through charges," Zarate warned. "Past records show Meralco holds direct and indirect ownership interests and stakes in several generation companies (gencos). We demand a full, independent audit to determine which gencos and transmission companies will receive these pass-through funds, exactly how much they will get, and which of these companies are tied to Meralco."
Zarate underscored that Filipino consumers have long been forced to bear the financial weight of industry failures.
"For decades, Filipino consumers have shouldered the cost of system losses and the operational inefficiencies of power utilities and the entire power industry. Hindi dapat ang konsumer ang nagbabayad para sa kapalpakan ng power industry at gobyerno," Zarate said.
Zarate stressed that repealing the Electric Power Industry Reform Act (EPIRA) of 2001 must be coupled with structural reforms through the passage of Bayan Muna’s proposed People’s Energy Bill framework. Instead of treating electricity as a market commodity controlled by private monopolies, Bayan Muna advocates for concrete policy alternatives:
1. Renationalization and Public Control: Transition energy from a profit-driven market to a heavily regulated public utility service, re-establishing strong state intervention to operate critical generation assets and control wholesale power prices.
2. Prohibition of Cross-Ownership: Strictly ban cross-ownership between power distribution utilities, generation companies, and transmission entities to eliminate self-dealing, artificial price spikes, and hidden pass-through profits.
3. Removal of Pass-Through Taxes: Exclude Value-Added Tax (VAT) and corporate tax liabilities from electricity bills, ensuring consumers only pay for actual, reasonable power consumption rather than corporate financial obligations.
4. Scrapping Performance-Based Regulation (PBR): Replace the current PBR system with a transparent, cost-based rate-setting framework that audited actual costs first before approving utility rates, halting the cycle of multi-billion over-collections.
5.Abolition of the WESM Direct Price-Setting: Overhaul or replace the Wholesale Electricity Spot Market (WESM) mechanism, which allows speculative pricing and artificial supply panics to dictate generation charges.
"This bigay-bawi scheme should be stopped. We need genuine reforms in the power sector that prioritize the welfare of consumers over the profits of private utilities," Zarate concluded. "It is high time EPIRA is junked and replaced with an energy policy that puts the Filipino people first." # # #
