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Persistent power instability in the Visayas is placing growing pressure on businesses and households as recurring yellow alerts, rising electricity rates, and prolonged plant outages expose deeper weaknesses in the region’s energy infrastructure.
The National Grid Corp. of the Philippines (NGCP) placed the Visayas grid under a yellow alert for the fifth straight day on May 22 and for the sixth time in May alone after operating reserves fell below required contingency levels. Available capacity reached 2,653 megawatts (MW), barely exceeding the projected peak demand of 2,485 MW during critical afternoon and evening hours.
The continuing supply tightness has triggered concerns among business groups, particularly for micro, small, and medium enterprises (MSMEs), which are struggling to absorb mounting operational costs while coping with recurring power interruptions.
Ongoing Plant Outages
The recurring yellow alerts stem largely from prolonged outages and reduced output across several major power facilities in the Visayas.
Fourteen power plants have gone on forced outages since May 2026, while multiple other facilities remain unavailable due to outages dating back to previous years. At least 12 plants are operating at reduced capacities, removing more than 880 MW from the grid.
Among the major unavailable facilities are Therma Visayas Inc. (TVI) Units 1 and 2 in Cebu and Panay Energy Development Corp. Unit 3 in Panay. TVI earlier said additional technical issues discovered in the steam turbines during maintenance inspections required more extensive repairs before the units could safely reconnect to the grid.
The thin reserve margin has significantly increased the risk of rotational brownouts should another large facility unexpectedly trip offline.
Business leaders said the immediate impact of recent outages remains manageable because most interruptions last around an hour. However, they warned that the larger concern is the uncertainty surrounding how long the crisis could continue.
Companies that rely heavily on uninterrupted electricity are now being forced to revise operational forecasts and contingency plans on short notice.
Burden On MSMEs
Small businesses are emerging as among the hardest-hit sectors because many lack the financial capacity to invest in backup power systems or sustain prolonged generator operations. Rey Calooy, chairman emeritus of the Filipino-Cebuano Business Club Inc., said most MSMEs continue to shoulder the burden on their own without direct government assistance for emergency fuel or generator costs.
“As far as I know, there is no such ayuda or direct support yet from local government units for MSMEs regarding generator fuel costs,” Calooy said. “Most small and medium businesses are still carrying the burden on their own.”
Frequent interruptions have disrupted internet connectivity, spoiled perishable goods and interrupted customer transactions for many establishments. Some firms have shortened operating hours or adjusted employee schedules during peak alert periods to reduce exposure to outages and higher electricity costs.
Business groups noted that MSMEs account for a large share of enterprises in the region, making the prolonged instability a broader economic concern that could eventually affect employment and productivity.
The crisis is also unfolding alongside rising fuel prices and concerns over the potential effects of El Niño on water supply, creating overlapping pressures for businesses already operating on thin margins.
Electricity Rates Climb
The tightening supply situation has also begun pushing electricity prices higher. Visayan Electric Company Inc. raised its residential electricity rate for May 2026 by ₱0.31 per kilowatt-hour (kWh), bringing the overall rate to ₱12.88 per kWh.
The utility attributed the increase to higher generation charges driven by volatile global fuel markets and supply constraints in the Visayas grid.
“Our priority has always been to protect our customers from sudden and significant increases, even as we face these external market volatilities and grid stability challenges,” Visayan Electric President and General Manager Mark Anthony B. Kindica said.
The utility said it has coordinated with power generators and the Department of Energy to help secure supply reliability and has continued implementing its Interruptible Load Program to manage demand during critical periods.
Consumers were also urged to conserve electricity during peak afternoon and evening hours to help stabilize the grid and manage household expenses.
Calls For Long-Term Energy Reforms
Business leaders and infrastructure developers said the recurring alerts underscore the need for deeper investments across the entire energy sector, including generation, transmission and grid stability systems.
Barbara “Bambi” Gothong-Tan, president of the Mandaue Chamber of Commerce and Industry, said temporary assistance measures may not be enough to address the broader challenges confronting the private sector. She said suspending excise taxes and value-added taxes on fuel and electricity could provide more meaningful relief to businesses struggling with rising operational costs.
Gothong-Tan also emphasized the need for stronger coordination among the NGCP, the Energy Regulatory Commission, and the Department of Energy in implementing long-term transmission and infrastructure projects.
Some larger companies have started investing in solar energy systems and backup generators to reduce dependence on the grid. However, smaller firms continue to face barriers due to high upfront costs.
Cebu-based infrastructure firm Vivant Corp. said the recurring yellow alerts highlight the need for more investments throughout the energy value chain. The company is evaluating investments in battery energy storage systems alongside conventional power facilities as part of its long-term infrastructure expansion plans.
“For these yellow and red alerts, it’s really a sign that we need more investments in the whole energy value chain,” Vivant Corp. Chief Executive Officer Arlo Sarmiento said.
Industry groups said the pace of repairs and restoration work at major unavailable plants will be critical in determining whether the Visayas grid can rebuild sufficient reserves and avoid wider, more disruptive blackouts in the months ahead.
Source:
https://www.sunstar.com.ph/amp/story/cebu/msmes-alarmed-by-visayas-grid-woes
https://www.sunstar.com.ph/amp/story/cebu/visayan-grid-flirts-with-brownouts