State audit sought for Meralco’s past energy sales, purchases

The validation of such records “can lead to the correction of the distribution charges of Meralco to the residential and commercial customers.”


MANILA — Consumer groups urged the government to review the finances of the country’s biggest electricity provider after finding a P66-billion discrepancy from its purchased supply.

In a statement, Bayan Muna and Matuwid na Singil sa Kuryente Consumer Alliance Inc. (MSK) said they wrote to the Department of Energy (DOE), seeking assistance to audit the Manila Electric Co.’s (Meralco) financial records between 2011 and 2019 which showed alleged discrepancies.

From an in-house evaluation of the listed company’s monthly generation filings to the Energy Regulatory Commission (ERC), as well as annual reports and audited financial statements since 2008, MSK found the following:

  • Meralco purchased only 33.59 billion kilowatt-hours (kWh) of power in 2019 but reported 46.87 billion kWh in energy purchases in the year. This means that Meralco apparently reported higher cost of purchased power to justify increase in electricity bill.
  • There was a P66.17-billion discrepancy in the company’s generation purchases disclosed to the ERC in 2019 at P179 billion against a declaration of P241 billion in its audited financial statement.
  • The company seemed to have over-recovered its distribution, supply, and metering (DSM) revenues by almost half last year, billing these to customers at P2.05/kWh, compared with the ERC-approved rate of P1.38/kWh. This means that Meralco possibly padded 0.67 centavos per kWH, according to Bayan Muna.

Bayan Muna sees the record discrepancies as a possible violation of the pass-through policy of the government. “Meralco should only be declaring as sales the actual (consumption in) kWh and value they purchased,” Chairman Neri J. Colmenares said.

Meralco might have started declaring higher energy sales, in contrast with actual purchases, in 2011, according to MSK. Last year, the alleged over-declaration was worth P66.17 billion from 13.57-billion kWh electricity delivered.

“There are unvalidated figures that are making this anomalous practice possible,” the consumer group claimed.

Both organizations wanted the DOE to order an explanation from the utility over the issues raised. They also wanted the ERC to validate the company’s declared generation purchases and costs and energy sales from each customer class: residential, commercial, and industrial.

The validation of such records “can lead to the correction of the distribution charges of Meralco to the residential and commercial customers,” MSK said.

Earlier, the ERC said in a statement that it is considering the assistance of the Commission on Audit (COA) to review Meralco’s conduct of refunds from some bill portions collected in the past years, including bill deposits, meter deposits, and income taxes.

Meralco came under fire in May as complaints mounted due to alleged over billing. The controversy arose from its use of estimated billing from March to May when the government-imposed lockdown prevented it from conducting physical meter readings.

Bayan Muna has blamed the utility’s apparent monopoly of power distribution in Metro Manila for the spike in consumer bills.

It was not a bit convinced of the company’s explanation for the bill uptick – Meralco claimed that the increase was due to heightened power usage during the warm months – despite power demand dwindling around 30 percent to 40 percent due to reduced overall consumption.

The group has also recommended a one-month relief of utility bills to help ease the consumers’ burden during this time of a pandemic. (

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