Bill shock: Marcos wants systems loss charge, VAT scrapped

MANILA, Philippines — Amid complaints over electric bill shock, President Marcos wants to remove systems loss charges passed on by power utilities to consumers along with the value-added tax on the fee.

This requires amendments to the 25-year-old Electric Power Industry Reform Act (EPIRA).

Marcos made this known in his penultimate State of the Nation Address (SONA) yesterday as the country staggers under soaring fuel prices brought about by the war in the Middle East now on its sixth month.

“If we’re talking about reducing the price (of electricity), I believe it is time to scrap the systems loss that is being passed on to consumers. It is being passed on to consumers and added to the bill with value-added tax on top of it,” Marcos said, for which he got a standing ovation and cheers from lawmakers in the session hall.

“It is not the fault of the consumer why there is systems loss. So it is not right that they are the ones to pay for it,” he noted.

“Therefore, we the people, request – no, we demand – for the immediate amendment of the EPIRA and to prohibit charging systems losses to consumers, including the value-added tax thereon,” the President stressed.

Systems loss refers to the loss in the transmitted electricity to the grid up to the consumers. Systems losses may be caused by natural processes as power passes through transmission lines and by outright theft through illegal connections or tampering of electricity meters.

For households and commercial establishments covered by the franchise of the Manila Electric Co., systems losses comprise about five percent of the electric bill.

The 2001 EPIRA allows utilities to pass on systems losses to customers, thus Marcos’ call for amendments to the law.

He said the cry of the people to reduce the cost of electricity was clear to the government.

Marcos also asked Congress to immediately pass the proposed “Sariling Kuryente Act,” which would make it simpler, easier and less expensive for people to install solar panels and battery storage systems.

Nuclear power

The Chief Executive also renewed his call for the use of nuclear energy for power generation, saying the technology is now safe.

“Pushing the envelope further, perhaps it is time for us to revisit nuclear energy production. We are already using nuclear energy in the fields of medicine, agriculture, water filtration and the upcycling of plastic,” Marcos said.

He said nuclear power will reinforce energy security and bring down the cost of electricity in the country.

“We will make sure that this will be safe. We will also ensure that we will explain clearly to the public the benefits of nuclear energy,” he said.

Marcos said under the Philippines’ chairship this year of the Association of Southeast Asian Nations, the Framework Agreement on Petroleum Security for the joint stockpiling of energy assets in the region has been ratified.

Now that the Luzon, Visayas and Mindanao grids are fully connected, the country is in a better position to connect with its neighbors to help realize the ASEAN Power Grid, he announced.

The government is also closely monitoring some 200 power projects scheduled to be completed by the end of his administration with a total capacity of nearly 10,000 megawatts. — Miriam Desacada