The Department of Energy reaffirmed its support for the President’s directive to eliminate system loss charges from consumer electricity bills, stating it is ready to collaborate with other government agencies to reduce losses through upgraded infrastructure, improved collection efficiency, and assistance to distribution utilities.
Energy Undersecretary noted that the department would work with the National Electrification Administration to determine the appropriate level of recoverable technical system losses and to explore additional measures that help electric cooperatives and distribution utilities improve their systems.
The Senate hearing focused on the President’s proposal, announced during his State of the Nation Address, to prohibit power companies from passing system loss charges onto consumers.
Senator questioned why consumers continue to shoulder costs from nontechnical losses such as theft, illegal connections, meter tampering and jumpers, and suggested prioritizing the removal of these nontechnical charges from consumer bills.
ERC Chairman explained that existing law allows recoverable nontechnical losses within a capped limit, encouraging utilities to reduce losses while preventing unlimited cost transfers to consumers.
Senate President proposed that distribution utilities absorb system losses, arguing that doing so would compel them to improve operational efficiency and anti-theft measures.
He urged authorities to intensify enforcement against electricity theft, stating that illegal connections should be addressed through law enforcement rather than recovered from paying consumers.
The Senate is reviewing several EPIRA amendments, including prohibiting consumer recovery of system loss charges and strengthening the powers of the regulatory commission, with a goal of completing the work before year‑end.
The committee plans to address the President’s call to lower electricity costs by reviewing the framework governing system loss charges under the country’s power reform law.
The government is conducting consultations with energy sector stakeholders after concerns were raised about the proposal.
Industry leaders warned that absorbing the cost could be too high for the sector, while the government emphasized the need to balance consumer relief with the stability of energy distributors and investors.
