Visayan Electric backs EPIRA reforms

CEBU, Philippines — Visayan Electric has expressed support for President Ferdinand Marcos Jr.'s proposal to amend the Electric Power Industry Reform Act (EPIRA), particularly the removal of system loss charges from consumers' electricity bills, saying the measure would help ensure fairer and more transparent electricity rates.

In a statement issued following the President's fifth State of the Nation Address (SONA) on July 27, the power distribution utility said it supports initiatives that would protect consumers from shouldering costs beyond their control.

The company said it will continue working closely with the Department of Energy (DOE), the Energy Regulatory Commission (ERC), and other industry stakeholders as discussions on the proposed EPIRA amendments progress.

While legislative reforms are still under study, Visayan Electric said it remains committed to reducing system losses through continued investments in power infrastructure and sustained campaigns against illegal power connections and electricity pilferage.

According to the utility, these initiatives help reduce unnecessary costs associated with power distribution, ultimately benefiting legitimate paying consumers.

"We stand firmly behind the President's goal of fairer electricity bills for all. Visayan Electric consistently works to keep system losses below the regulatory cap to help protect customers from unnecessary costs," part of the statement read.

The company added that it will sustain its aggressive campaign against power pilferage and illegal electricity connections, which remain among the major factors contributing to financial losses ultimately borne by paying consumers.

During his fifth SONA, President Marcos urged Congress to amend EPIRA to remove system loss charges from electricity bills as part of the administration's efforts to lower power costs and strengthen consumer protection.

The DOE said it is working with the ERC and the National Electrification Administration (NEA) to study the removal of system loss charges, Energy Secretary Sharon Garin said during a virtual press conference on Tuesday.

Garin said the DOE is also providing technical support to Congress and the Senate in deliberating amendments to EPIRA, including discussions on the proposed Sariling Kuryente Act, aimed at strengthening the country's energy sector.

In a separate statement, the DOE said it fully supports President Marcos' call for the immediate amendment of EPIRA, particularly reforms on the treatment of system loss charges.

"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 electricity sector has evolved significantly, with advances in technology, smarter electricity networks, and a rapidly changing energy landscape. Our policies must likewise evolve to deliver a power sector that is more efficient, transparent, accountable, and responsive to the needs of Filipino consumers," the DOE said.

The agency said the President's directive reflects the principle that consumers should no longer bear the cost of avoidable system losses that can be minimized through improved infrastructure, modern technologies, stronger operational discipline and more effective regulation.

It added that as distribution utilities modernize their networks through advanced metering systems, grid upgrades, digital technologies and stronger anti-electricity theft measures, system losses are expected to decline, allowing efficiency gains to translate into lower electricity costs for consumers while improving the overall performance of the power sector.

The DOE also emphasized that any amendments to EPIRA should strike a balance between consumer protection, affordability and maintaining a financially viable, reliable and resilient electricity industry.

"Legislative reforms must continue to encourage investments in modern infrastructure, improve operational efficiency, strengthen regulatory oversight, and promote greater accountability across the entire electricity value chain, while ensuring that Filipinos receive affordable, dependable, and high-quality electricity service," it added.

The department said it remains committed to implementing the President's directives and working with Congress, the ERC, industry stakeholders and consumer groups in crafting amendments that promote consumer welfare, strengthen energy security, reinforce investor confidence and build a more modern and future-ready power sector.

Calls for repeal

Progressive group Sanlakas, however, argued that EPIRA should be repealed and replaced instead of merely amended.

In a statement, the group said EPIRA amendments have long been part of the administration's legislative agenda but not necessarily for the reasons consumers expect.

"The amendment is not to lower electricity cost but to give back power to the Government, albeit limited, in generating electricity. Not to re-nationalize the generation sector but to legitimize its role in nuclear power generation," it said.

Sanlakas said lowering electricity rates would require reforms beyond removing system loss charges and the value-added tax, including disallowing pass-through charges, strengthening restrictions on cross-ownership, and reducing the country's dependence on fossil fuels.

"Left unaddressed, and given the oligopoly's hold on the power sector, market and price manipulation will continue to dictate the rising cost of electricity which at present is already the most expensive in the ASEAN region," it further said. — /FPL (FREEMAN)