Among the topics that drew Filipinos’ attention during President Ferdinand Marcos Jr.‘s penultimate State of the Nation Address was his call to remove system loss charges from consumers’ electricity bills.
The chief executive delivered his fifth SONA at the Batasang Pambansaon Monday, July 27, as he entered the final two years of his presidency.
In his speech, Marcos called on the Congress to amend the Electric Power Industry Reform Act (EPIRA), saying consumers should not shoulder the system loss charges included in their electricity bills.
System loss refers to the difference between the power delivered to a distribution system and the actual electricity billed to consumers. It may be caused by technical inefficiencies and electricity theft.
These losses may result from pilferage, as well as technical factors such as heat loss in wires and transformers.
“Panahon na para tanggalin na natin ang systems loss na pinapasa sa konsyumer,” Marcos said in his SONA, drawing cheers and standing ovation from lawmakers and other attendees at the Batasang Pambansa Complex.
“Pinapasa ito sa konsyumer at kinakarga sa bill na pinapatungan pa ng value-added tax. Hindi naman kasalanan ng konsyumer kung bakit nagkaroon ng systems loss. Kaya hindi naman tama na kailangan sila pa ang pagbabayarin dito,” he added.
“Therefore, we, the people, request — no, we demand — for the immediate amendment of the EPIRA and to prohibit charging systems loss against consumers, including the value-added tax thereon,” the president further said.
The EPIRA is a landmark 2001 law that privatized and restructured the Philippine power sector into four main segments: generation, transmission, distribution and supply.
It allows distribution utilities to pass on a portion of system losses to consumers through a system loss charge reflected in monthly electricity bills.
Marcos’ call to remove the system loss charge from consumers’ bills trended on social media as Filipinos continue to deal with high electricity costs.
Last June, the Philippines recorded the highest residential electricity rates in Southeast Asia.
A social media user tagged Meralco, the country’s largest private electric distribution utility, following Marcos’ remarks.
“@meralco, ‘yun systems loss tanggalin na niyo,” the X (formerly Twitter) user wrote, tagging the electricity provider.
Meralco responded by explaining the system loss charge.
“Ang System Loss Charge ay tumutukoy sa cost ng kuryenteng nawawala habang dina-deliver ito mula sa power plants hanggang sa inyong bahay o negosyo. Normal ito dahil may technical losses sa linya at equipment, at may kasama ring adjustments para sa pilferage o illegal connections,” it said.
“Ito ay pass-through charge, ibig sabihin, hindi ito napupunta sa revenue ng Meralco at bahagi ito ng kabuuang cost ng kuryente,” Meralco added.
“AYUN, DAPAT LANG. TANGGALIN ANG SYSTEMS LOSS CHARGE. First time to see Sen Risa applauding in this SONA,” another Filipino commented, referring to Sen. Risa Hontiveros who previously earned attention for refusing to clap when Marcos approached the podium for his second SONA in 2023.
Rep. Chel Diokno (Akbayan party-list) also took to social media to agree with Marcos’ remarks about the electricity bill.
“Systems loss charge sa kuryente, TANGGALIN NA!” he wrote with a check mark emoji.
“Nanawagan tayo sa Kongreso na aksyunan na sa mas lalong madaling panahon ang ating House Resolution No. 995 upang imbestigahan ang mabibigat at hindi malinaw na singil sa kuryente,” Diokno added, referring to a previous House resolution he filed.
Diokno filed House Resolution 995, which seeks to investigate the spike in electricity bills and other charges that are being passed to consumers, including the system loss charge, Lifeline Subsidy charge and other fees.
In his speech, Marcos argued that removing the system loss charge from consumers’ bills would help lower electricity costs by shifting the burden away from households and businesses, making an amendment to the law necessary.
He also urged lawmakers to pass the “Sariling Kuryente Act” to make the installation of solar panels and battery storage systems in households simpler and more affordable as Filipinos look for ways to reduce electricity costs.