Bill vs charging customers for system loss reaches Senate floor

MANILA — “No distribution utility shall recover disallowed system losses through distribution wheeling charges, supply charges, metering charges, universal charges, and subsidies.” 

This is one of the provisions of Senate Bill 2486 or the Systems Loss Charge Removal Act, which was sponsored in plenary at Tuesday’s session. 

Sen. Erwin Tulfo, chairperson of the Senate Committee on Energy as well as author and primary sponsor of the measure, said that “for years, Filipino families have been paying not only for the electricity they consume, but also for electricity that is lost before it reaches their homes.”

While distribution utilities charge for system loss, he pointed out that there are companies that charge less.

“Meralco, for example, posted a system loss rate of around 5%, below the ERC’s indicative cap of 6.5%. But performance across distribution utilities varies widely, with some electric cooperatives still reporting double-digit system losses, in extreme cases as high as 18% to 20%,” Tulfo said.

According to the lawmaker, if distribution utilities shoulder the cost, there will be more reason for them to stop theft, fix their meters, and improve their service. 

“Instead of automatically allowing system loss as a pass-through charge, the ERC will determine what costs are prudent, reasonable, and necessary in an efficiently operated distribution system,” Tulfo said.

Changes will not be instant as the bill provides for a phased transition of up to three years.

Several senators supported SB 2486. 

“Kung hindi kasalanan ng consumer at kaya naman itong maiwasan ng distribution utility, bakit taumbayan ang pagbabayarin?” Sen. Joel Villanueva said in his co-sponsorship speech.

“The bill also closes the back door: A disallowed cost cannot be hidden under another charge. Walang saysay ang pagtanggal ng isang line item kung ililipat lang sa ibang pangalan. Dapat walang taguan at walang palusot sa electric bill,” he added.

Sen. Bam Aquino proposed once again the removal of Value-Added Tax on the entire electricity bill, which will translate to savings of 12%.  

Sen. Bong Go also expressed support, saying senators are not questioning the right of distribution utilities to recover expenses.

He said theyonly want to ensure that charges passed on to the public are just and are in accordance with the law.