Manila: Sen. Francis 'Chiz' Escudero has introduced a legislative proposal aimed at eliminating the burden of system loss charges from electricity consumers. The bill seeks to hold power companies accountable for these costs instead.

According to Philippines News Agency, Escudero filed Senate Bill No. 2345 to amend the Electric Power Industry Reform Act of 2001, which currently permits distribution utilities to pass on a regulated portion of electricity losses incurred during distribution to consumers. This legislative move follows President Ferdinand R. Marcos Jr.'s directive to scrap system loss charges mentioned in his State of the Nation Address.

System losses refer to both technical losses, such as those from electricity transmission through power lines, and non-technical losses like theft and unauthorized connections. Escudero emphasized that consumers have no control over distribution system conditions or losses due to inefficient operations, outdated infrastructure, or electricity theft.

The proposed amendment would prevent utilities from charging end-users for costs associated with technical inefficiencies or pilferage. Escudero noted that although the existing policy acknowledges the operational challenges in electricity distribution, its ongoing application is becoming increasingly indefensible.

By requiring utilities to absorb these losses, the proposal aims to incentivize them to upgrade their systems, enhance anti-pilferage measures, and improve overall efficiency. Escudero highlighted that this would ensure fair electricity pricing and foster operational improvements. Additionally, the measure is expected to bolster consumer protection and align with the government's objective of reducing electricity rates and enhancing regulatory oversight.