Senator Sherwin Gatchalian has filed a bill that seeks to abolish the collection of bill deposits by distribution utilities (DUs) and electric cooperatives (ECs) in a bid to alleviate the burden of residential power consumers reeling from high electricity rates.

Senator Sherwin Gatchalian (Senate PRIB photo)

In filing Senate Bill No. 1470 or the Anti-Bill Deposit Act, Gatchalian seeks to relieve power consumers unnecesary financial burden by mandating immediate refund of existing bill deposits, together with the accrued interest.

Under the current system, power consumers are required to provide a bill deposit, which is a security deposit, to guarantee payment of future electricity bills.

“This way, we can ensure equal and affordable access to electricity for everyone, without having to pay a deposit,” Gatchalian said.

Moreover, the bill also mandates the Energy Regulatory Commission (ERC) to conduct an independent audit of all bill-deposit accounts and to prescribe non-deposit-based credit-risk alternatives, such as prepaid or pay-as-go metering systems, installment or staggered payment arrangements, and voluntary credit insurance or guarantee schemes in order to maintain payment discipline without imposing upfront costs.

Under the measure, DUs and ECs should refund all existing bill deposits, together with accrued interest up to the date of the actual release.

Gatchalian said the refunds shall be released in cash, check, or electronic transfer, unless consumers choose to apply them to future bills.

“This measure strengthens consumer protection, promotes equitable access to electricity, and aligns regulatory practices with the State’s mandate to provide reliable and affordable power service,” the senator said in the explanatory note of the bill.