Pass-through Charges, AWAT, and FIT-All — FAQs
FAQs on Pass-through Charges
1. What are Pass-through Charges?
Pass-through charges are costs that Meralco collects on behalf of power generation companies (GenCos), the National Grid Corporation of the Philippines (NGCP), and government entities such as local government units (LGUs). These amounts are not retained by Meralco but are remitted to the appropriate parties.
2. Why is there an P8.7B Pass-through Charges recovery? Why collect now?
The adjustment is in accordance with ERC's Decision on its regular confirmation of MERALCO's pass-through charges.
For the period 2011 to 2022, the ERC confirmed an ₱8.7-billion net under-recovery for MERALCO. This means that Meralco's payment for its allowable pass-through charges to GenCos, NGCP, and government entities was higher than it was able to recover through customer billings during the same period.
3. Why did my bill increase even though there are refunds?
The ERC-approved adjustment consists of seven pass-through charge components.
Refund adjustments
- Lifeline Subsidy Adjustment
- Senior Citizen Subsidy Adjustment
Collection adjustments
- Generation Charge Adjustment
- Transmission Charge Adjustment
- System Loss Charge Adjustment
- Real Property Tax (RPT) Adjustment
Refund/Collection, depending on LGU
- Local Franchise Tax (LFT) Adjustment
The Lifeline Subsidy, Real Property Tax, and Local Franchise Tax adjustments will appear as separate charges/line items on the bill, labeled "Lifeline Rate Adjustment," "RPT Adj.," and "LFT Adj". All other adjustments will form part of the monthly rates and will not appear as separate line items.
While customers receive refunds from some components, the collection adjustments are greater than the refunds. As a result, the adjustments result in a net collectible amount, which is why customers may notice an increase in their electricity bills.
4. How can you assure me that Meralco isn't overcharging me?
Meralco only implements pass-through charge adjustments that are reviewed and approved by the ERC.
5. Who approved the Pass-through Charges recovery?
The P8.7B Pass-through Charges recovery was reviewed and approved by the Energy Regulatory Commission (ERC) through its confirmation process covering pass-through charges of MERALCO from 2011 to 2022.
6. When will the Pass-through Charges adjustment start and end?
Implementation will begin in the August 2026 billing.
Adjustments in generation, transmission, system loss, RPT and LFT are estimated to be implemented over 36 months. For lifeline and senior citizen subsidy adjustments, the estimated refund period is 1 month.
7. Will all customers be affected the same way?
No, not all customers are affected equally.
Some pass-through charge adjustments vary depending on customer class or municipality. As a result, the impact may vary from one customer to another.
FAQs on Actual Weighted Average Tariff (AWAT) Refund/Collection
1. Why is there a refund? Has Meralco has been charging me in excess?
The refund is due to the difference between the average distribution rate collected in 2025 and the rate approved by the ERC for the same period.
This difference resulted from variations in the actual monthly consumption of different customer groups. After completing its review, the ERC determined that the actual average rate was higher than the approved rate, requiring the difference to be returned to customers.
There is no over-charging. This is also not a penalty. The refund is part of the ERC's regular process of reviewing and adjusting electricity rates. Meralco filed the applications for the refund, with ₱9.5 billion to be refunded over six months, or until the full amount is returned. Customers will see the refund on their bills as "AWAT (Refund)/Collect 2."
2. When will the AWAT (Refund)/Collect 2 refund start and end?
The new ₱9.5-billion refund covering January to December 2025 will start on the August 2026 billing cycle. It will run for six months, or until the full amount has been refunded. The line-item will appear on customers' bills as "AWAT (Refund)/Collect 2."
3. Who are qualified for the refund?
All customers with active accounts and kWh consumption are qualified to receive the refund.
4. How much refund will I get?
The refund is computed based on your monthly kWh consumption and the refund rate for your customer class.
Sample computation for a residential customer:
- Total monthly consumption: 200 kWh
- AWAT refund rate: ₱0.5861/kWh
- Total AWAT refund: ₱117.22
The actual refund may vary depending on your electricity consumption for the month. You can find the amount on your bill under "AWAT (Refund)/Collect 2."
5. Where do I see the refund in my bill?
It can be found at the back of the bill, labeled AWAT (Refund)/Collect 2, under Rate Components.
6. How many more refunds can I expect for the year or years to come?
The implementation of any refund will be done in accordance with any directive made by the ERC.
7. I have a newly energized or terminated account, will I also get refunded?
Only active accounts at the time of implementation are eligible for the refund.
FAQs on the Feed-in Tariff Allowance (FIT-All) Charge
1. What is FIT-All Charge?
The Feed-in Tariff Allowance (FIT-All) is a uniform charge approved by the Energy Regulatory Commission (ERC) and collected from all electricity consumers nationwide. It funds payments to eligible renewable energy developers under the Feed-in Tariff (FIT) System, which encourages the development of renewable energy sources such as solar, wind, biomass, and run-of-river hydro.
2. Why am I charged for FIT?
The FIT-All is required under the Renewable Energy Act of 2008 (RA 9513) to support the country's renewable energy program. It is collected from all electricity consumers by Distribution Utilities, Retail Electricity Suppliers, and the National Grid Corporation of the Philippines (NGCP), then remitted to the National Transmission Corporation (TransCo). Meralco serves only as a collecting agent and does not earn from this charge.
3. Why is the FIT-All rate being updated?
The ERC granted provisional authority to TransCo to implement the 2026 Working Capital Allowance (WCA) Rate Adjustment. The WCA provides additional funds to help ensure the timely payment of obligations under the FIT System and the efficient administration of the FIT-All Fund.
4. What is the new FIT-All rate?
Effective the August 2026 billing period, the provisional Working Capital Allowance (WCA) adjustment of ₱0.1348/kWh will be added to the current FIT-All rate of ₱0.2011/kWh, resulting in a new FIT-All rate of ₱0.3359/kWh.
5. Is FIT-All a new charge?
No. FIT-All has been part of electricity bills since 2015. The August 2026 implementation is an adjustment to the existing FIT-All rate, not the introduction of a new charge.
6. Who determines the FIT-All rate?
The Energy Regulatory Commission (ERC) approves the FIT-All rate after evaluating TransCo's application. Collecting agents, including Meralco, implement only the rate approved by the ERC.