Philippine Energy Industry Cautious on Marcos Power Reforms

Philippine President Ferdinand Marcos Jr. called for energy reforms in his State of the Nation Address on Monday, including the removal of the systems loss charge that consumers pay on electricity bills. The reaction from the industry was measured, with utilities and energy groups urging a careful study before any legislative change.

Systems loss, the electricity lost during transmission and distribution, has been a point of contention. Distribution firms like Manila Electric Co. (Meralco) are allowed to recover a portion of that loss from consumers under the Electric Power Industry Reform Act (Epira) and the Anti-Pilferage Act. The charge is capped at 6.5% of delivered energy, set by the Energy Regulatory Commission (ERC).

Marcos also pushed for the passage of the Sariling Kuryente Act, which aims to make rooftop solar panels and battery storage more affordable for households. The Department of Energy (DOE) said it fully supports the president's direction. Energy Secretary Sharon Garin said the department stands ready to translate those priorities into concrete programs, investments, and legislative reforms.

Meralco executive vice president and chief operating officer Ronnie Aperocho said the company respects the policy move but noted that system loss is a common operational aspect of electricity delivery. He said Meralco has invested in network modernization to keep its own losses well below the 6.5% cap. The company said it would participate actively in the discussions as the proposed amendments are deliberated, adding that any reforms should support the ability of distribution utilities to invest in infrastructure and system resilience.

Developers of Renewable Energy for AdvanceMent Inc. President Jose Layug called for an in-depth study. He said system loss has two components: technical losses, as energy turns into heat flowing through wires and transformers, and non-technical losses, such as theft and illegal tapping. Eliminating the charge entirely, he argued, could overlook the technical reality that some losses are inherent.