Davao Electricity Rates See Significant February Decline After January Surge
Residents of Davao City are experiencing welcome relief this month as residential electricity rates have posted a substantial decrease, providing much-needed financial breathing room for households still recovering from January's sharp power cost increase.
Substantial Rate Reduction Announced
Davao Light and Power Co., Inc. has confirmed that the overall residential electricity rate has dropped by P1.42 per kilowatt-hour for February 2026. This brings the new rate down to P10.30/kWh from last month's P11.72/kWh. The updated pricing will apply to electricity bills received between February 11 and March 11, 2026.
This reduction represents a positive reversal from January's challenging situation, when consumers faced one of the steepest month-on-month increases in recent memory. During the previous billing cycle covering January 11 to February 10, 2026, rates had climbed by P2.0052/kWh from P9.7135/kWh in December 2025 to P11.7187/kWh.
Market Dynamics Driving Price Changes
According to Davao Light officials, the February decrease was primarily driven by lower prices in the Wholesale Electricity Spot Market (WESM), which serves as one of the utility's key power supply sources. Spot market prices had experienced significant spikes in January due to power plant outages and supply constraints, forcing distribution utilities to procure electricity at substantially higher rates.
"This adjustment is mainly driven by lower power supply prices from the Wholesale Electricity Spot Market, one of Davao Light's sources of power supply," the company stated in its official announcement.
With improved supply conditions this month, market prices have softened considerably, translating directly into lower generation charges for residential consumers throughout Davao City.
January's Complex Rate Situation
January's rate hike occurred despite a slight reduction in transmission charges announced by the National Grid Corporation of the Philippines. Data revealed that the average transmission rate for the December 2025 billing period, which was reflected in January bills, slipped by 0.68 percent to P1.3455/kWh from P1.3547/kWh.
Of that transmission amount:
- P0.5971/kWh was allocated to Ancillary Services covering reserve power costs
- P0.6058/kWh represented transmission wheeling charges for delivering electricity across the national grid
NGCP clarified that it charges approximately 60 centavos per kWh for delivery services and emphasized that transmission costs are pass-through charges regulated by the Energy Regulatory Commission.
Multiple Factors Influencing Power Costs
The modest decline in transmission charges during January was overshadowed by several significant factors:
- A substantial surge in generation costs
- The implementation of the Green Energy Auction Allowance (GEA-All), a government-mandated charge designed to support renewable energy procurement
Although slight reductions in the Feed-In Tariff Allowance and a Renewable Energy Certificate refund provided partial relief to consumers, these measures were insufficient to offset the elevated spot market prices that prevailed during the January billing period.
Market Volatility and Consumer Guidance
This February's lower rate reflects more stable supply conditions and reduced reliance on high-priced spot market purchases. However, Davao Light has cautioned that electricity prices remain vulnerable to market volatility, particularly fluctuations in WESM rates and unforeseen plant outages that could disrupt supply.
The distribution utility has encouraged customers to continue practicing energy efficiency measures, noting that responsible consumption remains the most effective way to manage electricity bills amid changing market conditions.
While the P1.42/kWh reduction does not completely erase the impact of January's spike, Davao Light representatives emphasized that it signals a positive shift for consumers and underscores how dynamic supply-and-demand factors directly affect monthly power costs in the region.
