Ombudsman urged to probe ERC for ‘failure’ to stem overpricing

[Updated June 9, 2026, 8:40 p.m.]

MANILA, Philippines — A consumer watchdog on Tuesday urged the Office of the Ombudsman to investigate the Energy Regulatory Commission (ERC) for alleged failure to impose a Supreme Court (SC) ruling which they say led to overpriced power rates.

For its part, the ERC said they will respond should the antigraft body compel them to respond in a complaint filed by the United Filipino Consumers and Commuters (UFCC).

READ: DOE, ERC policies must be checked, too amid high costs, brownouts

In their complaint, UFCC President Rodolfo Javellana Jr. and accountant Marcelo Tecson said the ERC allowed Meralco’s after-tax return on equity much higher than 12 percent, which is the SC-ruled rate of return for public utilities.

UFCC noted that Meralco’s return of equity reached 32 percent in 2024. 

“Meralco’s excessively high annual rate of return was obviously derived from unreasonably high power rates,” the complaint stated.

Meralco Vice President and Head of Corporate Communications Joe Zaldarriaga said they have not received a copy of the complaint “or any directive from the office of the Ombudsman about this complaint.”

“We will respond once we have received and read the Complaint,” Zaldarriaga said in a message to Inquirer. “Rest assured that all the components of the rate being charged by Meralco are all approved by the ERC.”

The UFCC also cited the letter of ERC chair Francis Saturnino dated Jan. 26, stating the 12 percent jurisprudence does not apply to the performance-based regulation (PBR) rate setting methodology, citing SC decisions in two National Association of Electricity Consumers for Reforms, Inc. cases which upheld the PBR method without a return limit.

“We beg to differ,” the complaint said of the ERC letter.

“We respectfully request the Office of the Ombudsman to conduct an investigation into whether Energy Regulatory Commission officials, in performing their regulatory functions, have failed to comply with our relevant laws and jurisprudence. If so, require them to comply,” it further said.

For their part, the ERC said they have responded to Tecson’s letter, where they explained how they determine the allowable rate of return, which they said is not capped at 12 percent, “contrary to what he is espousing.”

The ERC said they have yet to receive a copy of the complaint to the Ombudsman.

“If the Ombudsman will act on it and require us to submit a comment or response, then we will do so at the proper time and venue,” the ERC said in a statement. /jpv /mr