ILOILO City — An electric cooperative in Iloilo Province has raised concerns over President Ferdinand Marcos Jr.’s proposal to remove the system loss charge from consumers’ electricity bills, warning that the move could create a major financial burden unless the government clearly identifies who will absorb the cost.
Iloilo 1 Electric Cooperative, Inc. (ILECO 1) general manager Engineer Miguel Paguntalan Jr. said the proposal may benefit consumers but poses difficult questions on the financial viability of power distribution if distribution utilities (DUs) are prohibited from recovering system losses.
“Sin-o sina ang magabayad? Sin-o ang maga-assume sang mga losses? Generator bala? Ang DU nagabakal ukon naga-receive lang sang kuryente. Daw indi mo man masiling nga fair nga si DU ang ma-absorb sina,” Paguntalan told members of the media.
He acknowledged that the President’s proposal is theoretically possible but believes implementing it would be extremely challenging.
Paguntalan stressed that lawmakers should first conduct an extensive study before amending the Electric Power Industry Reform Act (EPIRA), noting that some level of system loss is unavoidable in electricity distribution.
Under current regulations, ILECO 1 passes on an average system loss of six to seven percent to consumers — well below the government’s allowable cap of 10.25 percent, said Paguntalan.
He added that the government has yet to explain what mechanism or parameters would replace the existing system if consumers are no longer required to pay the charge.
“Masakit ina kon ipa-absorb mo sa ILECO,” said Paguntalan.
As an alternative, Paguntalan suggested that the government subsidize distribution utilities or establish and operate its own power plants to provide ancillary services, which he believes would be a more effective way to reduce electricity rates.
During his fifth State of the Nation Address, President Marcos urged Congress to pass the proposed “Sariling Kuryente” Act and called for the immediate amendment of the EPIRA to prohibit charging consumers for system loss, arguing that electricity users should not be made to pay for inefficiencies beyond their control.
“Panahon na para tanggalin na natin ang system loss na pinapasa sa consumer… Hindi naman kasalanan ng consumer kung bakit nagkaroon ng system loss. Kaya hindi naman tama na kailangan sila pa ang pagbabayarin dito,” the President said./PN
