Philippine Senators Back EPIRA Law Amendments to Lower Power Costs

Several senators on Tuesday backed President Ferdinand R. Marcos, Jr.’s call to amend the Electric Power Industry Reform Act (EPIRA) of 2001 and remove system loss charges from consumers’ electricity bills, with lawmakers promising to prioritize measures aimed at lowering power costs. Senate Energy Committee Chairman Erwin T. Tulfo filed resolutions seeking an investigation into system loss charges, the repeal of the Energy Tax law and the removal of the 12% value-added tax (VAT) on system loss charges. “We will try before the end of this year to prioritize system loss, as well as the VAT,” he told a news briefing on Monday evening. “If we remove the 12% VAT and the 5% to 10% system loss, the [bill] reduction will be significant.” He said his committee would continue hearings on proposed amendments to the EPIRA law and expressed support for the President’s call for reforms in the power sector. Mr. Tulfo also said he wants to amend the Downstream Oil Industry Deregulation Act to help address rising energy costs. Following Mr. Marcos’ fifth State of the Nation Address on Monday, Mr. Tulfo said the committee would fast-track deliberations on the EPIRA changes, noting that the measure still has to undergo three committee hearings before sponsorship. “Maybe before the end of this Congress, I’ll make sure that we will accomplish [the amendments],” he said. Senator Francis Pancratius “Kiko” N. Pangilinan also said he is prepared to help push the reforms in the Senate. Mr. Pangilinan, who earlier filed Senate Bill No. 2124 seeking to exempt system loss charges from VAT, said the proposed changes would boost consumer protection and improve transparency in the power sector. “I welcome the President’s proposal, and I am ready to help move it forward in the Senate,” he said in a statement. “If we are serious about lowering the cost of living, we must pursue reforms that make electricity more affordable, transparent and fair for every Filipino.” He added that the reforms were long overdue and called for energy policies that better address consumers’ needs. Senator Ana Theresia “Risa” N. Hontiveros-Baraquel likewise supported the proposal to remove system loss charges but said broader reforms are needed. Ms. Hontiveros, who authored Senate Bill No. 2706 seeking to remove the 12% VAT on electricity system loss charges, said policymakers should also review electricity generation, transmission and distribution charges. “It’s a step in the right direction, but this is only the beginning,” she told reporters after the President’s address. “From the removal of system loss and VAT on system loss charges, we should also look into the other aspects of EPIRA to amend it or repeal it for a new energy law.” Meanwhile, Party-list Rep. Sarah Jane I. Elago, said amending the EPIRA would not be enough, arguing that the law itself should be repealed because it institutionalized a privatized and deregulated power industry that has kept electricity rates high. In a statement, Ms. Elago said the President’s proposal to remove system loss charges from consumers’ electricity bills would provide only limited relief while leaving the broader framework of EPIRA intact. “Removing system loss charges is not enough if the law that allowed the privatization and deregulation of the power industry remains in place,” she said in Filipino. “EPIRA is the root cause of very high electricity rates. It should not just be amended; it must be junked.” — Kaela Patricia B. Gabriel and Pexcel John Bacon