EXPANDING indigenous renewable energy (RE) provides stable pricing that shields consumers from volatile market costs and lowers electricity rates, the Institute for Climate and Sustainable Cities (ICSC) said Thursday.
ICSC’s insight comes after the Department of Energy (DOE) announced that the Philippines has the highest average residential electricity rate in Southeast Asia. According to the DOE, high electricity prices have been driven by tightening supply, prolonged power plant outages, higher fuel costs, and greater reliance on more expensive electricity sources.
Nearly 50 distribution utilities (DUs) recorded residential electricity rates above the national average of P12.43 per kilowatt-hour (kWh) in June 2026, indicating that consumers in many parts of the Philippines continue to pay significantly more than the national benchmark.
‘National averages, however, tell only part of the story. Data compiled by ICSC through its electricity rate monitoring platform-the Power Rates and Energy Supply Overview for the Philippines (PRESYO-PH)-indicates that 48 on-grid electricity providers recorded residential rates above the national average in June 2026. This shows that many Filipino households are paying significantly more than the national benchmark,’ it said.
Electricity prices are influenced by a range of factors, including power supply agreements, exposure to the Wholesale Electricity Spot Market (WESM), and local operating conditions. The recurrent outages of many coal power plants, particularly in the Visayas region, have driven WESM prices sharply higher. This significantly contributed to the recurring grid alerts and the increase in electricity rates. DUs with greater exposure to WESM purchases were particularly affected by these price spikes.
Southern Leyte Electric Cooperative (Soleco) posted the highest residential electricity rate in June at P16.57 per kWh, up 32 percent from May. This surge occurred after the generation charge-the largest component of an electricity bill-shot up by almost P4 per kWh.
Next is the Aurora Electric Cooperative, Inc. (Aurelco) which currently charges P16.42 per kWh.
On the other hand, there are DUs with lower rates like Bohol Electric Cooperative I (Boheco I) in Bohol province, whose residential electricity rate was approximately P10.80/kWh in June. Another is Sna Jose City Electric Cooperative (Sajelco) in NuevaEcija, with a residential electricity rate of P9.85/kWh.
ICSC said a contributing factor to these lower rates is their power procurement strategy, which prioritizes geothermal energy, an indigenous resource with relatively stable and predictable generation costs. As a result, despite elevated WESM prices, these DUs were better able to shield their consumers from higher electricity costs.
ICSC pointed out the need to diversify the country’s power mix by expanding the use of indigenous RE resources with more stable and predictable pricing, supported by prudent long-term power procurement and planning.
‘While recent public discussions have focused on the various charges reflected in electricity bills, the generation charge consistently accounts for the largest share of what consumers pay. This highlights the need for a more diversified power mix centered on indigenous renewable energy resources and improved power procurement strategies that prioritizes affordability, energy security, and resilience,’ noted ICSC Energy Transition Advisor Alberto Dalusung III.
He stressed that expanding the role of indigenous RE resources presents a practical path toward a more secure, affordable, and reliable energy future.