โ๐๐๐ฅ๐ญ ๐ญ๐ก๐ ๐๐๐๐ ๐ข๐ง๐๐ซ๐๐๐ฌ๐โ: ๐๐๐๐๐๐๐๐ ๐ฌ๐๐๐ค๐ฌ ๐๐๐ข๐ซ ๐ฉ๐จ๐ฐ๐๐ซ ๐ซ๐๐ญ๐๐ฌ ๐๐จ๐ซ ๐จ๐๐-๐ ๐ซ๐ข๐ ๐๐จ๐ฆ๐ฆ๐ฎ๐ง๐ข๐ญ๐ข๐๐ฌ
The Philippine Rural Electric Cooperatives Association, Inc. (PHILRECA) expresses full support to the Association of Isolated Electric Cooperatives, Inc. (AIEC) in advocating for more equitable and justifiable electricity pricing within its service areas.
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Board Resolution No. 09-67-25, approved by PHILRECA on 29 September 2025, reflected AIEC’s position to immediately defer the implementation of the Energy Regulatory Commission (ERC) Order dated 23 September 2025. The order granted interim relief to implement the National Power Corporation’s (NPC) proposed increase on the subsidized approved generation rates (SAGR) for small power utility group (SPUG) areas.
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Why the Resistance?
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The rate hike, which will be implemented over two years, will result in a cumulative increase of Php 1.8564 per kilowatt-hour (kWh) for commercial and industrial customers in their monthly bills; half of which would be implemented this November.
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The rate adjustment will heavily affect small business entities in Mindoro, Marinduque, Palawan, Busuanga, Catanduanes, Romblon, Tablas Island, Masbate, Camotes, Siquijor, Bantayan, Basilan, Sulu, and Tawi-Tawi.
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PHILRECA warns the substantial rate hike will have detrimental effects on off-grid communitiesโtriggering inflation, delaying economic growth, and hindering investment and job growthโultimately worsening poverty and unemployment in these already economically vulnerable areas.
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“This SAGR increase not only contradicts the national policy of providing electricity at the least cost but will also severely impact residential consumers,” PHILRECA stated. “This will deplete disposable income for small families and businesses, further worsening the already difficult conditions for communities in remote communities.”
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The Need to Review
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Through their motion, the AIEC raised that: (i) the SAGR increase runs counter to the intent of the Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001 (EPIRA) and its regulatory framework on missionary electrification; (ii) the interim relief was issued without transparent methodological basis and due consideration to oppositions; and (iii) there are no clear and uniform guidelines on the implementation of the interim SAGR.
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The projected Php 2.8 billion savings presented by the NPC from the SAGR increase will have a negligible impact to the reduction of the Universal Charge for Missionary Electrification (UCME), equivalent to merely Php 0.0252/kWh, or Php 5.04 for a residential customer with 200-kWh average consumptionโwhich does not justify the adverse economic burden that will be shouldered by consumers in SPUG areas.
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As viewed by the AIEC, this increase โeffectively transforms missionary electrification from an instrument of progress into a barrier against it, contrary to the spirit of social justice and balanced regional development envisioned by the EPIRA.โ
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The ERC’s order has two glaring concerns: lack of clear guidelines on consumer classification and billing arrangements, potentially leading to inconsistencies and unfair rate applications, and approval of interim SAGR rates without transparency or due process, making the decision arbitrary and potentially unjustified.
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What Can Be Done?
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At the outset, PHILRECA and AIEC believe that the ERC should defer implementing the order until the Motion for Reconsideration is resolved or the Application has undergone full evaluation.
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In the long run, the reduction of subsidies in off-grid areas without burdening consumers can be achieved through expedited interconnection of the off-grid islands with significant electricity demand growth to the countryโs main transmission system, and expedited implementation of NPC’s hybridization plans in off-grid areas to lower the True Cost of Generation Rate (TCGR).
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No Island Left Behind
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PHILRECA joins the call for an immediate and just energy transition, shifting from expensive and polluting diesel power plants to RE sources. This will not only reduce the cost of electricity but also promote sustainable development and environmental protection.
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“We urge our member-ECs and the general publicโespecially the local government officials in the island and off-grid communitiesโto push AIEC’s advocacy against the rate hike. Together, we can make a difference and ensure that electricity remains affordable and accessible to all,” said PHILRECA.
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It is noteworthy that various localities in Romblon have previously adopted resolutions expressing their opposition to ERC Case No. 2023-133 RC, also known as the Petition for the Approval of the Proposed New Subsidized Approved Generation Rates (SAGR) for NPC-SPUG Areas with Prayer for Provisional Authority or Interim Relief.
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PHILRECA remains committed to working with AIEC and other relevant stakeholders to seek for more concrete solutions that prioritize the welfare of the communities while promoting economic development and sustainability.
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