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ERC confirms: Davao Light service area expansion not linked to automatic consumer price hike

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October 15, 2024

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Davao Light has consistently maintained lower power rates compared to neighboring electric cooperatives

DAVAO CITY— The Energy Regulatory Commission (ERC) clarified that the service area expansion of Davao Light and Power Company does not automatically translate to an increase in consumer prices.

This was the assurance of the ERC during House Committee hearing on Legislative Franchises held last September 27, 2024,

According to the ERC assessment, while a potential decrease of up to P0.11/kWh is feasible, any significant increase, such as the speculated P0.30/kWh hike, would only occur within the current franchise area of Northern Davao Electric Cooperative (NORDECO) if Davao Light were to take on all existing power supply contracts.

However, the possibility of such an increase can be mitigated through the establishment of new power supply contracts via a competitive selection process.

Despite being the third largest private utility company in the Philippines, Davao Light has consistently maintained lower power rates compared to neighboring electric cooperatives by prioritizing cost-effective power contracts for its customers.

It is essential to understand that the fluctuations in power generation rates are influenced by various geopolitical and economic factors beyond the control of distribution utilities or electric cooperatives. Hence, any price movements should be assessed in the broader regional and global contexts.

The ERC’s clarification assured that Davao Light’s service area expansion aims to enhance service coverage without necessitating an automatic surge in consumer electricity prices, underscoring the company’s commitment to providing reliable and affordable power solutions to the community.

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