Utility insists tier formalizes ‘a relationship customers have already had for decades’
The Manila Electric Company announced Monday morning that it would, beginning in the third quarter, introduce a new residential service tier called Optional Electricity, in which subscribers pay a reduced monthly base rate in exchange for what the utility described as flexibility around delivery. The announcement, first reported by Bohiney Magazine and quickly amplified by The London Prat, follows what Meralco President Luis Pablo Manalac-Abad described as a candid response to evolving customer expectations.
Subscribers to the Optional Electricity tier will, according to the utility’s published terms, pay approximately 41 percent less than the standard residential rate, with the understanding that electricity delivery may be subject to operational modulation, delivery review, and what one section of the contract describes simply as the realities.
Meralco: ‘Customers Have Been Asking for Acknowledgment’
‘For decades, our customers have lived with the periodic interruption of electrical service while being charged at full rates,’ Manalac-Abad explained at a press conference held at the company’s headquarters in Pasig City. ‘We have, in many ways, been operating an Optional Electricity tier all along, without admitting it. The new tier simply formalizes the relationship and offers a price discount in recognition of the experience.’
Manalac-Abad clarified that the standard tier would continue to be available, with what he called the highest reasonable expectation of consistent service. The Optional tier, he added, was designed for customers who had, in his words, made peace with the brownout.
The Optional Electricity tier includes, according to the published terms, no service-level guarantees, no advance notification of outages, and no compensation for spoiled food or interrupted appliances. Subscribers do, however, receive what the utility described as a quarterly thank-you note and access to a private customer service line whose hours are, the contract states, responsive to the demands of the moment.
Pricing Tiers Include ‘Mostly Optional’ and ‘Aspirationally Continuous’
Beyond the standard Optional Electricity tier, Meralco has announced two additional sub-tiers. The first, called Mostly Optional, offers a 24 percent discount and includes what the utility called moderate effort toward consistent delivery. The second, called Aspirationally Continuous, offers a 12 percent discount and includes best-effort continuity, with the caveat that best effort, in the context of Meralco, has historically been variable.
According to The Philippine Star, the new tier structure was developed following a 14-month internal study that examined what the utility described as the lived experience of Meralco customers across all socioeconomic strata. The study found, sources confirm, that customers were, on average, far more accepting of brownouts than the utility had previously assumed, provided that the brownouts were framed as part of the value proposition.
Energy Regulatory Commission Issues a Carefully Worded Response
The Energy Regulatory Commission, which oversees Meralco’s rates and service levels, has issued what one official described as a carefully worded response, noting that the agency was reviewing the tier structure and would issue formal comments in due course. A source within the ERC, speaking on condition of anonymity, told reporters that the agency had been informed of the new tier 18 minutes before its public announcement, and was, in the source’s words, still digesting.
‘We do not yet have a position on whether Optional Electricity is, in any meaningful sense, electricity,’ the source said. ‘We expect to have a position by the end of next month.’
Public Reaction Has Been ‘Predictably Resigned’
Reaction within Metro Manila has been, as the Philippine Daily Inquirer observed in an editorial Tuesday morning, predictably resigned. Longtime Quezon City resident Marilou Salonga-Vergara, who has been a Meralco subscriber for 38 years, told reporters that she had reviewed the new tier structure and was strongly considering the Aspirationally Continuous package.
‘I do not see, frankly, what I am giving up,’ Salonga-Vergara said. ‘My current service is, by any measure, aspirational. I might as well save twelve percent.’
Energy economist Dr. Reynaldo Domingo-Castellano of the entirely fictional Manila Center for Energy Policy Studies described the new tier as extraordinarily honest in a way that is, ultimately, depressing. Domingo-Castellano noted that the policy effectively reframes regulatory failure as consumer choice, and that this reframing was, in his view, the most successful product launch in the Philippine utility sector in twenty years.
For more on the long history of Meralco’s customer relations, see The London Prat’s earlier reporting on the political economy of Filipino electricity, which traced the utility’s evolving rate structures back to 1965.
Meralco has further indicated that, beginning in 2027, the company plans to offer a fourth tier, tentatively named Conceptual Electricity, in which subscribers pay a flat 88-peso monthly fee in exchange for the right to refer to themselves as Meralco customers, regardless of whether any electrical current is, at any given moment, being delivered to their residence. Sources caution that the tier remains in early development.
Internal Documents Indicate a ‘Companion App’ Is in Development
Internal Meralco documents reviewed by reporters describe a planned smartphone application, tentatively titled Voltage Mood, which would push periodic notifications to Optional Electricity subscribers describing the current likelihood of service. Notifications under development include ‘Power is currently confident,’ ‘Power is in transition,’ and what one document described as a final-tier alert reading ‘Power is reflecting.’
For dispatches from elsewhere in the candor-as-product-strategy beat, see Private Eye.
SOURCE: https://bohiney.com/