NAVOTAS Rep. Toby Tiangco has refiled House Bill 10273, or the proposed System Loss Charges Abolition Act of 2026, Tuesday, a measure he first introduced in 2016.
This comes as a response to President Ferdinand Marcos Jr.'s call in his fifth State of the Nation Address (SONA) Monday to abolish system loss charges on consumers’ electricity bills.
Marcos said consumers should no longer bear system loss charges in their monthly electricity bills.
“In 2016, this did not move forward. Now, the president himself clearly acknowledges that the practice of passing on system loss costs to consumers must stop,” Tiangco said in Filipino.
“I am hopeful that in this Congress, we will have the sufficient political will to enact this reform into law,” he added.
Under the bill, all distribution utilities, including private distribution utilities and electric cooperatives, will be prohibited from passing on, recovering, or collecting system loss charges from consumers regardless of their cause or classification. The measure also exempts system loss charges from the Value-Added Tax (VAT).
Tiangco said that with Philippine electricity prices remaining among the highest in the region, Congress should seize the opportunity to institutionalize reforms that provide immediate and tangible relief to consumers.
"If we are serious about lowering electricity rates, we must eliminate fees that are not the people's fault. This is a concrete step that every Filipino family will immediately feel in their monthly bills,” he said.
The Philippines has some of the highest electricity rates in Southeast Asia, with the national average hitting P12.43 per kilowatt-hour (kWh).
In urbanized areas like Metro Manila, rates reach up to P14.83 per kWh due to generation charges, the Malampaya gas shutdown, and high dependence on imported fossil fuels.
House of Representatives Speaker Faustino Dy III vowed on Wednesday swift passage of measures that would ease the financial burdens of Filipinos.
“We stand with the president in the goal of lowering family expenses and providing greater relief to Filipino workers. These are the types of reforms we must prioritize passing,” he said in Filipino.
These measures include amending the Electric Power Industry Reform Act to stop passing system loss charges on to consumers and revising the National Internal Revenue Code to expand income tax exemptions and lower tax rates, particularly for middle-income earners.
Dy said consumers should not bear the cost of system losses caused by inefficiencies or electricity theft, noting government estimates that households using up to 200 kilowatt-hours monthly could save about P80 if the charges are removed.
The proposed tax package would raise the annual income tax exemption threshold to P350,000, reduce income tax rates for other workers, exempt small businesses from the minimum corporate income tax, and grant tax amnesty for unpaid taxes and related penalties.
Lawmakers are targeting third-reading approval of the tax relief package by August to allow its implementation on Jan. 1, 2027, according to House Committee on Ways and Means Chairman and Marikina Rep. Miro Quimbo.
