Manila Electric Co. (Meralco) is ramping up infrastructure investments and cracking down on illegal connections as part of its multi-pronged strategy to drive down system losses that drive up consumer electricity bills.

In a statement on Sunday, Aug. 16, Larry Fernandez, Meralco head of utility economics, said the country’s largest power distributor is balancing physical grid upgrades with stricter anti-theft operations to target both technical and non-technical inefficiencies across its distribution network.

To curb technical losses—the energy naturally dissipated as heat through lines and transformers—Meralco is expanding substation capacity and upgrading distribution lines to optimize overall network efficiency.

On the non-technical side, which primarily stems from unauthorized hookups and power theft, Meralco is pairing aggressive enforcement actions with redesigned infrastructure built to physically deter tampering.

System loss charges passed along to end-users remain a contentious component of monthly electric bills in the country.

Fernandez noted that recovering a portion of these costs from consumers is explicitly permitted under Republic Act No. 7832, known as the Anti-Electricity and Electric Transmission Lines/Materials Pilferage Act, as well as the landmark Electric Power Industry Reform Act of 2001.

However, Meralco said that revenue recovered from penalizing power thieves does not stay on its balance sheet.

Instead, all financial settlements collected from apprehended violators are returned directly to legitimate customers in the form of bill deductions.

Looking ahead, Meralco plans to accelerate the deployment of smart grids and advanced metering infrastructure across its franchise area.

The modern distribution systems will allow real-time monitoring of power flow, enabling the utility to pinpoint technical disruptions instantly, identify abnormal usage patterns linked to theft, and balance energy loads more efficiently for residential and commercial customers.