A JOINT TASK FORCE consisting of representatives from energy agencies and electric cooperatives is working on plans to remove system loss charges from electricity bills, the Department of Energy (DoE) said.
In a press release on Thursday, the DoE said it is going to lead the team, whose other members shall be the Energy Regulatory Commission (ERC), the National Electrification Administration (NEA), and electric cooperatives.
President Ferdinand R. Marcos, Jr. had called for the removal of system loss charges and the resulting value-added tax from electricity bills during his fifth State of the Nation Address.
In line with the DoE, the duty force will assess the technical, regulatory, and legislative work needed to roll out the proposed reforms.
“Central to its mandate, the Joint Task Force will pursue reforms that protect consumer interests, improve operational efficiencies, and strengthen the long-term reliability of the Philippine power sector,” the DoE said.
The system loss charge is a component of the generation and transmission costs paid to power producers and the grid operator. It covers electricity losses from technical and non-technical aspects like illegal connections.
The Electric Power Industry Reform Act of 2001 allows the recovery of system losses from consumers, subject to caps to be set by ERC based on technical considerations.
The joint task force’s technical recommendations will guide each chambers of Congress in drafting laws that advances a cheaper, reliable, and resilient energy sector, the DoE said.
Beyond legislative reforms, it is going to also pursue measures to cut back system losses on the source through improved operational efficiencies, stronger enforcement motion against electricity theft, and the modernization of distribution networks.
The DoE and ERC has also begun their discussions with Manila Electric Co. (Meralco), the country’s largest private electric distribution utility, to evaluate the corporate’s pricing structure.
“As a part of this comprehensive review, the DoE and ERC are rigorously assessing Meralco’s price structure to deliver fairer electricity bills for Filipino consumers,” the department said.
Citing its consultation with Meralco, the DoE said the ability distributor expressed its commitment to explore ways to regulate its operations to cut back electricity prices and ease the financial burden on households and businesses.
The DoE and ERC are also working with NEA to evaluate the impact of the proposed reforms on electric cooperatives and distribution utilities. — Sheldeen Joy Talavera