MORE Power rates frozen since 2022, so why bills jumped?

By Francis Allan L. Angelo

As consumers across Iloilo City reel from noticeably higher electricity bills, MORE Power Electric Corp. is clarifying what many are misattributing to the distribution utility: the spike is driven by global energy prices and summer consumption surges — not by MORE Power’s own rates, which have been frozen since 2022.

In an episode of MORE Power at Your Service, Ralph Durilag of MORE Power’s Corporate Energy Sourcing and Regulatory Affairs (CESRA) broke down the anatomy of a monthly bill, component by component — and the picture that emerged challenges the prevailing social media narrative.

The bill you pay is not all MORE Power’s

The first thing consumers need to understand, Durilag said, is that an electric bill is not a single charge but a layered stack of costs from multiple sectors, only one of which actually goes to MORE Power.

The generation charge makes up the biggest slice — roughly 45% to 50% of every bill. On a PHP 1,000 monthly electric bill, about PHP 500 goes straight to the power generators that produce the electricity.

The transmission charge follows, covering the cost of moving high-voltage electricity across the national grid from distant generating plants to Iloilo. This is billed by the National Grid Corporation of the Philippines (NGCP) and passed through to consumers exactly as charged.

The distribution charge — the only line item that goes to MORE Power — accounts for 15% to 20% of the bill. On that same PHP 1,000 bill, MORE Power receives roughly PHP 150 to PHP 200 for operating and maintaining the poles, lines, substations, and field crews that bring power from the NGCP grid down to individual homes and businesses.

The balance is made up of value-added tax (VAT), government charges, system loss charges, and subsidies for marginalized consumers and senior citizens.

“The distribution charge is what MORE Power charges,” Durilag emphasized. “And we have not moved that since 2022 — four years without an increase.”

Two major forces

So why are consumers seeing bills go up?

Durilag identified two compounding factors.

The first is higher consumption. Summer means heat, and heat means air-conditioning. What used to run one to two hours a day is now running three to five hours. More kilowatt-hours consumed equals a higher bill — independent of any rate change.

The second is a slight rate increase in generation. The Middle East conflict has pushed global energy prices upward, and electricity pricing in the Philippines is not immune to international commodity markets. Generation rates — the 45% to 50% portion of the bill controlled by power producers, not MORE Power — have edged up accordingly.

“When both the kilowatt-hour consumption increases and the rate increases, the total peso amount paid naturally goes up,” Durilag explained. “That is what consumers are experiencing right now.”

System loss: from 30% to under 5.5%

Perhaps the most dramatic number Durilag cited was system loss — the electricity that is lost between generation and the consumer’s meter, through both natural physics (heat dissipation along lines and transformers) and non-technical causes such as illegal connections and pilferage.

When MORE Power entered Iloilo, system loss stood at nearly 30% — a figure that consumers were effectively paying for.

Through aggressive crackdowns on illegal connections and infrastructure improvements, MORE Power has slashed that figure to 5.37% total system loss and 3.67% feeder loss — both well below the Energy Regulatory Commission’s (ERC) maximum cap of 5.5%.

“We are almost 2 percentage points below the ERC cap,” Durilag said. “And when system loss goes down, the system loss charge that consumers pay goes down with it.”

The ERC’s framework requires that distribution utilities absorb any system loss costs above the regulated cap themselves — creating a direct financial incentive for MORE Power to keep its network clean of pilferage and efficient in operation.

Renewables quietly lowering VAT

One benefit consumers may not be aware of: electricity sourced from renewable energy carries zero VAT under Philippine law.

As MORE Power continues to increase its renewable energy mix, the blended VAT on the generation portion of the bill is trending downward — from the standard 12% toward roughly 8% to 9%.

“Every percentage point of renewable energy we bring in reduces the VAT consumers pay,” Durilag said. “That is one of the reasons we are actively pursuing more renewable sources.”

What consumers can do

For households feeling the pinch, MORE Power and the government’s energy efficiency programs offer a practical path: monitor consumption, understand each line item on the bill, and compare the current month’s kilowatt-hour rate against previous months — not just the peso total.

“The rate and the consumption are two separate things,” Durilag noted. “Even if the rate stays the same, running your air-conditioner five hours instead of two will raise your bill significantly.”

Consumers with questions about their specific bill components are encouraged to contact MORE Power’s customer care directly, rather than relying on social media interpretations that, Durilag said, often miss crucial context.

As for the broader energy cost crisis tied to global events: “We are hopeful things normalize soon,” Durilag said. “But in the meantime, let us all be conscious of how we consume electricity — and work together to get through this.”