Marcos Jr. Pushes for Removal of Systems Loss Charges from Power Bills

President Ferdinand “Bongbong” Marcos Jr. on Monday called on both chambers of Congress to amend the Electric Power Industry Reform Act (EPIRA) to put a stop to systems loss charges, including an accompanying value-added tax (VAT), from being passed on to consumers. Systems loss refers to electricity lost during transmission and distribution, whether caused by technical issues or illegal acts such as use of “jumpers” or pilferage. Current laws such as the EPIRA and Republic Act No. 7832 or the Anti-Pilferage of Electricity and Theft of Electric Transmission Lines/Materials Act allow distribution utilities to recover a portion of systems loss from end-consumers through systems loss charge reflected in monthly electricity bills. “At kung pagbawas ng presyo ang usapan, sa aking palagay, panahon na para tanggalin na natin ang systems loss na pinapasa sa konsyumer. Pinapasa ito sa konsyumer at kinakarga sa bill na pinapatungan pa ng value-added tax,” Marcos said. “Hindi naman kasalanan ng konsyumer kung bakit nagkaroon ng systems loss, kaya hindi naman tama na kailangan sila pa ang pagbabayarin dito,” the President said. (And if we're talking about lowering prices, I believe it's time we remove the systems loss charges being passed on to consumers. These charges are passed on to consumers, included in their electricity bills, and are even subject to value-added tax (VAT). The systems loss is not the consumers' fault, so it is not right that they should be the ones paying for it.) “Therefore, we the people request, no we demand, for the immediate amendment of the EPIRA and to prohibit charging of systems loss against consumers including the value added tax thereon,” Marcos said. The President, in his SONA, also called on lawmakers to pass the Sariling Kuryente Act to further reduce the cost of electricity for Filipino consumers. “Upang maging simple, madali, at abot-kaya ang pagpapakabit ng solar panel at battery storage systems sa kanilang mga bahay, hinihiling ko ang tulong ng Kongreso na maipasa na ang Sariling Kuryente Act,” Marcos said. Hontiveros bill Sen. Risa Hontiveros in May filed a bill seeking to remove the value-added tax (VAT) on system loss charges in electricity bills. Senate Bill No. 2076, which aims to amend the National Internal Revenue Code (NIRC) to exempt system loss charges from VAT, amid reports of higher electricity costs during the dry season. “Itong VAT sa systems loss ay dobleng pasakit at insulto: Pinagbabayad na nga tayo ng systems loss na hindi natin napakinabangan, tapos pagbabayarin pa tayo ng buwis dito,” Hontiveros said. (The VAT on system loss is a double burden and an insult: consumers are made to pay for system losses they did not benefit from, and are then taxed for it.) The Department of Energy (DOE) expressed support for the proposal. “Suportado ng DOE ang lahat ng layunin na naglalayong mapababa ang presyo ng kuryente sa bansa, kabilang dito ang pag-aaral na bawasan o alisin ang VAT sa kuryente,” Energy Secretary Sharon Garin said in a Facebook post. (The DOE supports all measures aimed at lowering electricity prices in the country, including the possibility of reducing or removing VAT on electricity.) “Will VAT removal lower electricity prices? It will,” she said. However, she stressed that the proposal needs further evaluation, noting that the decision does not rest with the DOE. “Nasa economic managers at Kongreso ito dahil may mas malawak na epekto sa ekonomiya,” she said. (It is in the hands of the economic managers and Congress, as it has broader implications for the economy.) –NB, GMA News