THE Philippine Chamber of Commerce and Industry (PCCI) has backed proposals to remove system loss charges and the value-added tax (VAT) on electricity from consumers’ power bills, saying the measures would provide immediate relief but should be accompanied by broader reforms to reduce electricity costs over the long term.
In a statement posted on the chamber’s Facebook page, PCCI president Perry Ferrer said eliminating system loss charges and the corresponding VAT would help ease the financial burden on households and businesses, but stressed that structural reforms remain necessary to improve the country’s competitiveness.
“The removal of system loss and associated VAT on electricity provides immediate relief, but it must be followed by broader reforms to truly ease the burden on consumers and industries,” Ferrer said.
“Our competitiveness depends on reliable and affordable power today while building sustainability for tomorrow. We cannot afford to let high energy costs continue to erode investment and industrial growth,” he added.
5th Sona
During his fifth State of the Nation Address on July 27, 2026, President Ferdinand “Bongbong” Marcos Jr., urged Congress to amend Epira to prohibit the passing on of system loss charges to electricity consumers, including the corresponding VAT.
“When we talk about reducing electricity prices, I believe it is time to remove system loss charges that are being passed on to consumers,” the President said.
“These charges are passed on to consumers and are included in their electricity bills, which are even subject to value-added tax. Consumers are not at fault for these system losses, so it is not right that they should be made to pay for them,” he added.
The President also called on Congress to immediately pass the proposed Sariling Kuryente Act, which seeks to simplify and reduce the cost of installing rooftop solar panels and battery energy storage systems in homes, enabling more households to generate their own electricity and helping lower power bills.
PCCI director for Energy and Power David Chua said consumers and businesses continue to shoulder numerous pass-through charges in their electricity bills.
“Removing system loss and VAT is a welcome start, but the bigger challenge lies in rationalizing other charges, diversifying our energy mix, and unlocking indigenous resources,” Chua said.
He added that these reforms would help ensure a more affordable and resilient power supply that is less vulnerable to global fuel price volatility.
5 priority reforms
The country’s largest business organization reiterated five priority reforms for the energy sector.
These include ensuring adequate baseload power capacity to provide round-the-clock electricity for industries; improving regulatory efficiency and electricity market mechanisms, including the transition from feed-in tariff (FiT) subsidies to competitive renewable energy procurement under the Green Energy Auction (GEA) program; promoting a more diversified energy mix that includes natural gas, liquefied natural gas (LNG), renewable energy, energy storage, hydrogen and nuclear power; expanding domestic energy exploration to reduce reliance on imported fuel; and accelerating transmission projects, streamlining permitting processes and enhancing electricity market flexibility.
PCCI said it is prepared to work with the Marcos administration and other stakeholders in pursuing reforms aimed at improving the affordability, reliability and sustainability of the country’s power sector.
The group said stable and competitive electricity prices are essential to attracting investments, supporting industrial expansion and sustaining economic growth. / KOC