Residential electricity rates will increase to P14.90 per kWh in July from P13.74 per kWh in June, Visayan Electric said.
The utility serves about 2.6 million people across Metro Cebu, covering the cities of Cebu, Mandaue, Talisay and Naga, as well as the towns of Liloan, Consolacion, Minglanilla and San Fernando.
The July adjustment marks the fourth consecutive monthly increase since April, when rates rose to P12.57 per kWh. Rates climbed further to P12.88 per kWh in May and P13.74 per kWh in June.
In a statement, Visayan Electric attributed the increase to a series of market and supply shocks since February, including higher transmission charges, rising global fuel prices linked to tensions in the Middle East, elevated summer electricity demand that strained already thin reserves, and surging Wholesale Electricity Spot Market (WESM) prices as generation shortages forced more expensive spot-market purchases.
In early July, a red alert and more than 1,000 megawatts (MW) of unavailable generating capacity further intensified the strain, pushing generation charges—the largest component of customers' electricity bills—to a one-year high of P11 per kWh.
Visayan Electric is the largest private electric distribution utility in the Visayas and a member of the Aboitiz Power Distribution Utilities (APDU) group, which also includes Davao Light, Cotabato Light and the EnerZone group of utilities.
High generation cost
Visayan Electric said the sharp rise in generation costs would have pushed July residential rates to P17.59 per kWh, but the utility took several measures to reduce the increase to P14.90 per kWh to help protect consumers.
The utility said it coordinated with the Energy Regulatory Commission (ERC), which approved the deferment of a portion of the costs, reducing the immediate increase by nearly 70 percent.
"We are not simply passing these costs through to the consumer," said Visayan Electric president and general manager Mark Anthony B. Kindica.
"We are proactively engaging the ERC for cost deferment, securing immediate supply agreements with generators, and accelerating our shift to stable, long-term power sources to minimize the burden on our customers," he added.
Steps
Apart from securing ERC approval for cost deferment, Visayan Electric said it entered into Emergency Power Supply Agreements (EPSAs) with power generators to augment supply while launching a Competitive Selection Process (CSP) this month to secure more stable and long-term electricity supply beginning next year.
The utility also said it continues to coordinate with National Grid Corporation of the Philippines (NGCP), the Department of Energy (DOE), the Independent Electricity Market Operator of the Philippines (IEMOP) and the ERC to protect supply reliability and consumers' interests.
Higher transmission cost
In a separate statement, NGCP said higher ancillary services (AS) charges also contributed to the increase in transmission rates for July.
The grid operator clarified that it does not earn from ancillary services because these charges are remitted directly to generation companies with bilateral contracts with NGCP and to the IEMOP for ancillary services procured through the Reserve Market.
Ancillary services are reserve power and grid support services procured by NGCP to maintain the stability and reliability of the transmission system.
These services help regulate grid frequency and voltage, provide backup power during generator outages, and enable faster restoration of electricity following disturbances or blackouts.
Supply constraints
The Visayas grid has been under pressure since May 12, when recurring yellow and red alerts began due to insufficient power supply caused by the forced outages of several major power plants.
According to the NGCP, the equivalent average transmission rate for the June 2026 billing period, which will be reflected in consumers' July electricity bills, increased by 0.77 percent to P1.4604 per kWh from P1.4492 per kWh in May.
Ancillary services rates increased by 10.18 percent, rising from P0.7220 per kWh in May to P0.7955 per kWh in June.
NGCP reiterated that the bulk of the transmission charge consists of ancillary services, which are essential to maintaining grid stability during supply-demand imbalances.
"As the system operator, NGCP's priority is to ensure the grid remains resilient during supply-demand imbalances. NGCP does not profit from AS charges, as these are remitted directly to the providers who help us maintain the continuous flow of electricity across the country," the grid operator said. —Ed: Corrie S. Narisma
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