Residential electricity rates in the Visayas have increased to P13.74 per kilowatt-hour (kWh) in June, up from P12.88/kWh in May, driven by higher generation charges resulting from tight supply conditions in the Visayas Grid.
Reasons for the rate hike
In a statement to SunStar Cebu, Visayan Electric explained that the increase is due to high electricity demand in May, coupled with limited operating reserves, which led to several declarations of Yellow and Red Alerts.
“The increase in electricity rates is primarily driven by higher generation charges resulting from tight supply conditions in the Visayas Grid,” Visayan Electric said.
The utility firm noted that these conditions forced them to rely on more expensive power sources and purchase electricity from the Wholesale Electricity Spot Market (WESM) to ensure a stable supply.
Factors affecting generation costs
“Generation costs were affected by higher prices in the Wholesale Electricity Spot Market (WESM), the continued depreciation of the Philippine Peso against the US Dollar, and sustained increases in global fuel prices, particularly for coal which are used by most power suppliers,” the company said.
Electricity prices in the market fluctuate hourly depending on factors such as available supply, demand levels, fuel prices, and power plant outages.
Rate trend in first half of 2026
Data shows that residential electricity rates have varied in the first half of 2026. The rate was P12.79/kWh in January, P12.38/kWh in February, P12.36/kWh in March, P12.57/kWh in April, P12.88/kWh in May, before rising sharply to P13.74/kWh in June.
Although the National Grid Corporation of the Philippines (NGCP) implemented a downward adjustment in transmission charges, the overall electricity price still increased.
Transmission reduction outweighed
“While transmission charges registered a downward adjustment, transmission costs account for only one component of a customer's electricity bill. The reduction in transmission charges was outweighed by the increase in generation charges, which remain the largest component of the bill,” Visayan Electric explained.
The company clarified that the savings from lower transmission costs were overshadowed by the significant increase in generation expenses due to supply shortages, higher market prices, foreign exchange fluctuations, and high fuel prices.
Impact on consumers
Consumers will feel the impact of the higher rate on their monthly bills, especially families whose energy consumption increased during the previous summer months.
