President Ferdinand R. Marcos Jr. called on Congress to immediately amend the Electric Power Industry Reform Act (EPIRA) of 2001 to remove system loss charges passed on to electricity consumers, saying households should not shoulder costs caused by inefficiencies in the power system.
During his fifth State of the Nation Address (SONA) on Monday at the Batasang Pambansa Complex in Quezon City, Marcos said lowering electricity prices requires reforms in how power costs are charged to consumers.
“At kung pagbawas ng presyo ang usapan, sa aking palagay panahon na para tanggalin na natin ang systems loss na pinapasa sa consumer. Ipinapasa ito sa consumer at pinapasok sa bill na pinapatungan pa ng value-added tax,” Marcos said.
He argued that consumers should not be responsible for system losses and that utility companies should address these costs through improved operations and infrastructure.
“Therefore, we, the people, request… no, we demand for the immediate amendment of the EPIRA and to prohibit charging systems loss against consumers, including the value added tax thereon,” he said.
Under the existing EPIRA framework, distribution utilities are allowed to collect pass-through charges, including system loss charges, from consumers.
System loss refers to electricity lost due to technical and non-technical factors during transmission and distribution.
The Energy Regulatory Commission sets limits on allowable system losses, ranging from 5.5 percent for private distribution utilities to as much as 8.25 percent to 12.25 percent for electric cooperatives.
Aside from removing system loss charges, Marcos also urged Congress to pass the Sariling Kuryente Act, which aims to simplify the installation of solar panels and battery storage systems for households.
“Upang maging simple, madali, at abot-kaya ang pagpapakabit ng solar panel at battery storage system sa kanilang mga bahay, hinihiling ko ang tulong ng Kongreso na maipasa na ang Sariling Kuryente or Own Electricity Act,” he said.
The proposal seeks to make household renewable energy adoption more accessible, addressing existing challenges involving approval processes and permitting requirements under the current net metering system.
The Department of Energy (DOE) backed the President’s call to revisit EPIRA provisions, particularly on system loss charges.
The agency said amendments should ensure that consumers are protected from avoidable electricity costs while maintaining a stable and financially sustainable power sector.
“Twenty-five years after EPIRA transformed the Philippine power sector, the time has come to ensure that our legal and regulatory framework keeps pace with today’s realities,” the DOE said.
The department added that system losses should be reduced through better infrastructure, modern technology, stronger operational discipline, and improved regulation rather than passing the burden to consumers.
Senator Risa Hontiveros welcomed Marcos’ proposal, saying the removal of system loss charges and the corresponding value-added tax could help ease household expenses.
“Talagang nagpupugay ako diyan at pati iyong pagtanggal sa VAT dahil medyo ipinanawagan ko na rin iyan earlier,” Hontiveros said.
She described the move as “a step in the right direction” but said broader reforms in the power sector should also be pursued, including a review of other charges imposed on consumers.
Business groups also welcomed the President’s energy agenda, citing its potential impact on industrial growth and investment.
Aurora Pacific Economic Zone and Freeport Authority (APECO) President and CEO Gil Taway said the administration’s plans could strengthen power supply, support industries, and improve reliability for consumers.
He cited the government’s target of developing around 200 power projects before the end of Marcos’ term, as well as additional battery energy storage system capacity, as important measures in stabilizing the grid.
Taway said APECO is working with energy companies and technology providers to develop a more resilient power ecosystem that can support investments and communities.
Meanwhile, Federation of Philippine Industries Chair Elizabeth Lee said improving the country’s energy system could help the manufacturing sector compete with neighboring economies.
“Paired with long-term energy security—through nuclear exploration, natural gas, hydrogen, and renewables—these reforms can build true industrial resilience,” Lee said.
The proposed EPIRA amendments will still require legislative action from Congress before any changes to system loss charges can take effect.
Photo courtesy of PhilStar
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