Manila Electric: System loss charges under regulatory scrutiny

研报英文原文证据摘录

Manila Electric: System loss charges under regulatory scrutiny

Global Research

29 July 2026ab

First Read

EquitiesManila Electric

System loss charges under regulatory scrutiny Philippines

Electric Utilities

12-month rating Buy

President Marcos calls to remove system loss pass-through in SONA

During his fifth State of the Nation Address, President Marcos called for amendments to 12m price target P750.00

EPIRA to abolish the pass-through of system loss charges and related VAT to consumers,

raising concern for Philippine distribution utilities such as Meralco. System loss is

Price (28 Jul 2026) P562.00

currently a regulated pass-through item, accounting for approximately 5% of Meralco's

over P14 average residential retail rate. The charge has ranged between ~P0.4-0.7/kWh RIC: MER.PS BBG: MER PM

over the past three years, fluctuating alongside electricity costs. This compares with Trading data and key metrics

Meralco's headline regulated distribution tariff of P1.3552/kWh.

52-wk range P662.00-520.00

Market cap. P633b/US$10.3b

Global practice supports recovery of unavoidable system losses

Shares o/s 1,127m (ORD)

These system losses include technical losses inherent in electricity distribution, as well as

Free float 26%

non-technical losses from pilferage and meter tampering. Global regulatory practice

Avg. daily volume ('000) 390

generally recognizes a certain level of technical losses as an unavoidable cost of

electricity delivery, with most jurisdictions allowing utilities to recover efficiently incurred Avg. daily value (m) P228.2

losses while penalizing excessive inefficiencies. Meralco's system losses are below the Common s/h equity (12/26E) P190b

6.5% cap imposed by the ERC, suggesting its network operates within regulatory P/BV (12/26E) 3.3x

benchmarks.