Electric Co-ops Warn of Crisis if System Loss Charges Scrapped Without Subsidy

PAGADIAN CITY, ZAMBOANGA DEL SUR, Philippines — Power distribution cooperatives across the country are pushing back against the proposed scrapping of system loss charges as a component of electricity bills, unless the national government takes on the cost through subsidies. Simply scrapping the charges could cripple rural electrification and drag down local economies, warned Jose. The system loss charge, a portion of the electricity bill, is intended to cover power losses during transmission and distribution, as well as those incurred from electricity pilferage. According to Jose, who is also the general manager of Zamboanga del Sur Electric Cooperative (Zamsureco-1), the cooperatives are pleading with the government to reconsider the potential repercussions of removing these charges. "We are not against the removal of system loss charges, but we are against the removal without any form of subsidy from the government," Jose said. He explained that if the system loss charges are removed without government subsidy, the financial burden would fall on the cooperatives, potentially leading to a decline in their ability to invest in infrastructure upgrades and maintain existing facilities. This could have a ripple effect on rural electrification efforts, as cooperatives might struggle to extend power services to unserved areas or improve the reliability of supply in underserved regions. Jose also highlighted the potential negative impact on local economies, as reliable electricity is a crucial factor for businesses and industries to thrive. "The removal of these charges, without a corresponding subsidy, would cripple our operations and ultimately hinder the economic development of the areas we serve," he stated. The cooperatives are urging the government to conduct a comprehensive study on the impact of removing system loss charges and to explore alternative solutions, such as providing subsidies, to ensure the continued provision of affordable and reliable electricity to all Filipinos. Source: Inquirer NewsInfo