SENATE President Win Gatchalian has filed a bill seeking to prohibit distribution utilities and electric cooperatives from passing system loss charges on to consumers.
Gatchalian filed Senate Bill 2350, or the System Loss Charge Abolition Act, in line with President Ferdinand Marcos Jr.’s call during his fifth State of the Nation Address (Sona) for Congress to amend the Electric Power Industry Reform Act (Epira) to stop charging consumers for system losses, including the value-added tax (VAT) imposed on these charges.
The Senate President said the measure is necessary to provide financial relief to consumers.
For distribution utility Meralco, the system loss charge typically accounts for five to six percent of a consumer’s total electricity bill.
Gatchalian noted that from August 2025 to July 2026, the average monthly system loss charge for a household consuming 200 kilowatt-hours (kWh) was P148.95.
“This translates to P1,787.38 paid by each consumer over the past year for system loss charges alone, excluding the additional VAT imposed on top of it,” he said.
“Filipino families should not be forced to pay for electricity they never used,” Gatchalian added.
Gatchalian welcomed Marcos’ strong focus on easing the economic burden on Filipino families, noting that affordable, reliable and secure energy is one of the strongest foundations of a competitive economy.
Senators JV Ejercito and Erwin Tulfo also filed separate measures seeking to end the charging of system losses to electricity consumers.
Ejercito filed Senate Bill 2342, which seeks to abolish the system loss charge, and Senate Bill 2343, which proposes the removal of the 12-percent VAT on electricity.
“Many of us are already suffering and burdened by high electricity bills, so we should eliminate charges that should not be passed on to consumers, and ensure that the power sector is more efficient,” Ejercito said.
“Consumers should only pay for the electricity they actually use and the services they receive. If you don’t use the electricity, you don’t have to pay,” he added.
Ejercito said the unnecessary costs passed on to consumers could instead be used by families for food, medicines, education and other basic needs.
Tulfo, chairman of the Senate Committee on Energy, filed Senate Resolution 537, which seeks an inquiry into the policy under the Electric Power Industry Reform Act of 2001 allowing system loss charges to be passed on to consumers. He also filed Senate Bill 2239, which seeks to repeal Batas Pambansa Blg. 36, or the Energy Tax Law, and Senate Bill 2340, which proposes exempting system loss charges from VAT.
He said the committee will discuss electricity-related bills and proposals on July 30.
Last week, the panel tackled proposed reforms to the 25-year-old Epira.
“We’re already done with the first hearing. After the second and third hearings, we will endorse the measure to the plenary for its sponsorship. I’m hopeful that our fellow senators will support it because this is exactly what the people need,” Tulfo said. (TPM/SunStar Philippines)