A national association representing isolated electric cooperatives has condemned a regulatory decision to raise power rates in off-grid areas (including Oriental and Occidental Mindoro), warning the increases will push hundreds of thousands into poverty while punishing island provinces still dependent on diesel generation.

The Association of Isolated Electric Cooperatives (AIEC) has demanded the suspension and reversal of the Energy Regulatory Commission’s (ERC) approval of a two-stage tariff hike that will nearly double electricity costs for commercial and industrial customers over two years.

“We fought this proposal vigorously,” said Engr. Rene Fajilagutan, AIEC president and general manager of Romblon Electric Cooperative. “We even commissioned an independent impact study that ERC itself commended for its rigor. Yet, in the end, ERC still sided with NPC.”

The ERC approved the National Power Corporation’s (Napocor) petition to raise the Subsidized Approved Generation Rate (SAGR) in areas served by the Small Power Utilities Group (SPUG), granting interim relief of P0.9282 pesos per kilowatt-hour in the first year and another P0.9282 pesos in the second year.

The increases, set to take effect in November 2025, will bring the rate from P6.46 pesos per kWh to P9.25 pesos per kWh, according to the September 23, 2025 decision under ERC Case No. 2023-133 RC.

A study commissioned by AIEC warned the rate hike would depress regional GDP growth, raise inflation, push over 10,000 people below the poverty line, and trigger job losses in several sectors.

The study, prepared by the Center for Power Issues and Initiatives, simulated the economic impact specifically on the MIMAROPA region using computable general equilibrium modeling.

Fajilagutan said some commercial users consuming 1,000 to 2,000 kWh monthly could see bills soar by as much as 600 percent once fully implemented.

NPC has argued that residents in SPUG areas now have an “increased capacity to pay” and that adjustments are necessary to offset surging diesel prices aggravated by the war in Ukraine.

But Fajilagutan called those claims “inaccurate and misleading,” noting even the National Economic and Development Authority (NEDA) found flaws in NPC’s analysis.

The AIEC president said recurring rate hikes stem from NPC’s dependence on “outdated, inefficient, and costly” diesel plants.

“It’s time to transition to renewable energy,” he said. “Otherwise, island residents will remain trapped in a cycle of high electricity costs while the rest of the country continues subsidizing dirty and expensive fossil fuel generation.”

AIEC said the government could have addressed NPC’s P2.8-billion-peso shortfall by adjusting the Universal Charge for Missionary Electrification by just 0.02 pesos per kWh instead of increasing consumer rates.

The association vowed to seek reconsideration of the ruling and urged member-consumer-owners in MIMAROPA to support the fight for fair and sustainable energy.