THE Department of Energy wants to stop non-technical system losses from being charged to electricity consumers but implementation will cost over P7 billion, officials said on Monday.
“[W]e were able to talk with the National Electrification Administration and other stakeholders to come up with a plan to help our electric cooperatives on this matter,” Energy Undersecretary Rowena Guevara said in a briefing.
President Ferdinand Marcos Jr. last month called for the removal of system loss charges from power bills in a bid to reduce the burden on consumers.
Systems losses — power that is not delivered to consumers — can either be technical (unavoidably caused by the physics of transmitting electricity) or non-technical (caused by theft, faulty meters, billing errors, etc. and thus preventable).
Power firms and cooperatives are currently allowed to charge a portion of their system losses to consumers, and Marcos wants relevant laws amended to end the practice.
Guevara said the DOE was planning to implement the removal of non-technical system loss charges over a year and in four stages, which will require a budget “more than P7 billion.”
“We have just finished the estimates, and we will be talking with the Department of Budget and Management or the Executive Secretary for the [funding] sources,” Energy Secretary Sharon Garin said.
“Options can vary and it could come from government funds or loans.”
The initiative will include anti-pilferage enforcement, consumer education, improving billing and collection efficiency, meter management and auditing; cleansing of the consumer database, institutional strengthening and policy reforms.
The government will continue to work on the removal of the technical systems loss component, Guevara said, with implementation eyed for the middle of next year.
“The DOE, together with other agencies, is discussing to formulate an optimal distribution development plan for all distribution utilities, specifically for electric cooperatives, to help reduce technical systems loss as we cannot remove this component outright because it is physics,” she said.
“We plan to have this established by around July of 2027, as this will definitely take time.”
