Metro Cebu braces for higher August power bills as spot market rates climb

CEBU CITY — Households and businesses across Metro Cebu should prepare for another round of higher electricity bills this August, as sustained increases in wholesale power prices continue to push up generation costs. Visayan Electric (VECO) has asked regulators for relief to soften the blow, but consumers may still feel the pinch.

VECO General Manager Engr. Mark Anthony Kindica said the utility expects August rates to remain elevated because of persistent high prices in the Wholesale Electricity Spot Market (WESM), which directly affects the cost of power that VECO purchases.

“We’ve seen our rates increase over the past few months, and I think our August bill may also become higher because market rates remain high,” Kindica said in Cebuano during a media forum this week.

Kindica stressed that VECO is working closely with the Energy Regulatory Commission (ERC) to explore options that could ease the burden on consumers. One such measure is a deferment, which allows the utility to postpone recovering part of its costs instead of charging the full amount in a single billing period.

“It depends on how high market rates go, but we are coordinating closely with the ERC to determine what we can do, including possible deferments, so the increase in rates will not be too steep,” he explained.

Last month, the ERC allowed VECO to defer a portion of its market costs, which helped moderate the rate increase. Kindica expressed hope that prices would stabilize by the fourth quarter of this year, though he cautioned that exact figures remain uncertain.

“By the fourth quarter, we expect prices to stabilize. We can’t speculate on the exact rate, but we are seeing prices eventually go down,” he said.

What is driving the higher power rates?

The main culprit is the elevated cost of electricity traded on the WESM, which VECO taps to supplement its supply when cheaper sources are insufficient. Kindica noted that the spot market remains “relatively expensive,” and this is directly reflected in consumer bills.

VECO’s reliance on the spot market has grown due to tight supply conditions across the Visayas grid, where power plants have faced recurring outages and maintenance shutdowns.

How VECO is trying to protect consumers

To minimize outages and keep costs in check, VECO continues to rely on its Interruptible Load Program (ILP). Under this program, large electricity users — such as malls and cement plants — voluntarily reduce their power consumption during periods of constrained supply.

“We call them first and ask if they can voluntarily reduce their consumption so we won’t have to implement rotational brownouts affecting our residents and small customers,” Kindica said. “So far, only a few areas have experienced rotational brownouts because of their cooperation.”

The ILP has been a key tool in preventing widespread blackouts, even as supply remains tight.

What consumers can expect next

Kindica advised consumers to monitor their bills and practice energy efficiency, especially during peak hours. He reiterated that VECO will continue coordinating with the ERC to manage rates for the rest of the month.

“We will continue coordinating with the ERC on how we can manage rates this month,” he said.

For now, the message from VECO is clear: August bills will likely be higher, but the utility is doing what it can to keep the increase manageable.

Photo: CDN Digital