Philippines Debates Electricity System Loss Charges

MANILA, Philippines — Manila Electric Co. (Meralco), the country’s biggest power distributor, said Tuesday that some system losses are an “inherent” part of delivering electricity even as President Ferdinand Marcos Jr. pushes to drop the charges from Filipinos’ bills. Meralco executive vice president and COO Ronnie Aperocho said the utility respects President Ferdinand Marcos Jr.’s policy direction and will join discussions on proposed amendments to the Electric Power Industry Reform Act (Epira), enacted in 2001. He, however, stressed that “a certain level of technical losses remains inherent in operating an electric distribution system.” Systems loss charges account for about 5 percent of Meralco bills and cover electricity lost to technical and non-technical factors. Electricity pilferage, including illegal tapping and jumper wires, usually causes non-technical losses. “We believe it is important to recognize that system loss is not unique to any distribution utility but is a common operational aspect of the delivery of electricity — which affects the entire power industry,” Aperocho said. “For Meralco’s part, we have consistently invested in system loss management initiatives, network modernization, and operational efficiencies — which enable us to maintain our system loss well below the 6.5 percent cap set by the ERC (Energy Regulatory Commission),” he added. The executive was likewise hopeful that the government would “carefully consider the impact of reforms on the operations and sustainability of distribution utilities.” For its part, the Energy Regulatory Commission (ERC) also backed Marcos’ proposal, saying it was ready to work with Congress, the Department of Energy and industry stakeholders to implement the reform. In a separate statement, the regulator said reforms should remove unnecessary costs while keeping distribution utilities viable and the power sector reliable and affordable. “The Commission will continue to promote efficiency and support meaningful reforms that would contribute to lower electricity rates without compromising the quality, reliability, and sustainability of electric service for all Filipinos,” the ERC said. /pai INQ