Senate President Sherwin Gatchalian on Sunday, August 2 expressed confidence that the measure seeking to remove system loss charges, as well as the value-added tax (VAT), from electricity bills would be approved before Christmas or the end of this year.

“I can actually see the legislation moving forward because there is already a meeting of the minds among the President, the House of Representatives, and even the Senate—where eight (8) senators have filed bills to eliminate the system loss charge,” Gatchalian said in Filipino in an interview with Radio DZBB.

“With a significant number of lawmakers—nearing a majority—having filed these bills, there is a consensus to approve the measure. I believe this can be finalized within three (3) to six (6) months,” the Senate chief added.

Gatchalian, one of the senators who filed the proposed System Loss Charge Abolition Act, said the biggest issue that remains is the computation of system loss.

The burden currently falls on electricity consumers, but lawmakers are planning to shift the responsibility of absorbing the system losses to the distribution utilities (DU).

“The challenge lies in crafting regulations that mandate the utility to absorb this cost while ensuring it isn't surreptitiously passed on to consumers through other line items,” Gatchalian said.

“Right now, the charges are unbundled, so you can see the system loss explicitly listed on the bill; the risk is that if we prohibit this specific charge, utilities might hide the cost under other items where it wouldn't be visible,” he explained.

“That is why my proposed bill (Senate Bill No. 2350) is strict: it explicitly prohibits shifting the cost to other items and requires that it be reflected in the distribution utilities' income statements. The main bottleneck I foresee here is the ERC (Energy Regulatory Commission)—specifically, the task of issuing regulations to guarantee that these costs aren't concealed within other charges passed on to us,” he pointed out.

Asked if the bill would be approved by December, Gatchalian replied in the affirmative: “Correct.”

“The most significant lobby is that of the consumers—the general public. After all, our electricity rates are high—at P14 per kilowatt-hour, the highest in Southeast Asia. That is the most powerful lobby and the loudest grievance,” the senator said.

“We have been studying this issue for a long time; it only resurfaced now because our President possesses the necessary political will. And based on the lawmakers' analysis, the distribution utilities are capable of absorbing the impact,” he reiterated.

Sen. Erwin Tulfo, chairman of the Senate Committee on Energy, vowed to complete the committee hearings before the year ends to revamp the policies that currently allow companies ot pass system loss charges onto consumers.

Tulfo also remained firm that electric companies are gaining billions in profit because they are confident they can charge system losses to the public while electricity consumers suffer from poverty.

“Where is the concept of social responsibility in all of these? The community is drowning in debt and poverty while they gain billions in profit by draining the consumers dry,” a visibly irate Tulfo said also in a DZBB interview.

“It’s unfair. Why should consumers bear the brunt of these system losses? The electric companies are the ones responsible for their own losses,” the senator added.

At the same time, Tulfo urged power distributors and generation companies “to cooperate.”

“Let’s lighten the load of Filipinos and remove system loss charges. If you look at the bill, it’s only a few hundred pesos, but it’s a big deal for our poor countrymen. That could already buy rice or fuel—it really is a big help,” Tulfo emphasized.

“These distributors and generation companies have social responsibilities too. Try to cooperate. Don't just keep taking—give back a little, too,” he further stated.

Earlier, during his fifth State of the Nation Address (SONA) President Ferdinand R. Marcos Jr.’s fifth State of the Nation Address (SONA) issued a directive to Congress to provide consumer relief in light of the public’s demand for lower electricity prices and affordability of energy.

Among those who filed such measure in the Senate include Gatchalian, Tulfo and Sen. Joseph Victor “JV” Ejercito.