Manila: The Senate Committee on Energy on Thursday focused on differentiating unavoidable electricity losses from those caused by theft, meter defects, and other preventable factors, as lawmakers examined ways to prevent such costs from being transferred to paying consumers.
According to Philippines News Agency, Committee Chair Senator Erwin Tulfo emphasized the need to reform the system loss policy by clearly distinguishing between technical losses inherent in electricity transmission and inefficiencies that distribution utilities can prevent or control. Tulfo stressed that inefficiencies should not be subsidized, while also ensuring that power companies remain financially viable and continue to invest in better networks and services.
The discussion progressed after Energy Regulatory Commission (ERC) Chairperson and CEO Francis Saturnino Juan informed the panel that utilities could potentially be prohibited from recovering non-technical system losses from consumers entirely. Juan noted that non-technical losses currently account for about 1 percent based on the performance of distribution utilities, and stopping their recovery would not significantly threaten their viability. However, utilities could still be allowed to include measures against pilferage and meter errors in their tariffs.
Tulfo acknowledged the inevitability of technical losses due to natural electricity loss during delivery but questioned why consumers should bear the cost of losses due to power theft, illegal connections, and meter tampering. The Department of Energy (DOE) agreed that preventable losses should not be passed on to households and businesses. DOE Undersecretary Riolita Inocencio highlighted the need for stronger support for distribution utilities and electric cooperatives in combating electricity theft, including potential revisions to the Anti-Pilferage Law.
The hearing is considering proposals ranging from reducing recoverable system-loss caps to eliminating certain system-loss charges altogether. Various bills on the issue have been filed by Senators JV Ejercito, Francis Escudero, Francis Pangilinan, and Senate President Sherwin Gatchalian. Additionally, Tulfo has filed a resolution seeking an inquiry into the existing policy.
Tulfo stated that the central question is not merely whether electricity losses occur, but which costs can fairly be charged to consumers and which should be absorbed or addressed by companies that can reduce them. The panel is also evaluating whether reforms should cover all system losses or only non-technical losses, while balancing consumer protection with the financial viability of distribution utilities and electric cooperatives.
