Pacquiao on power rates: Why are consumers paying for system loss?

Camille Elemia Updated 9:50 PM, August 16, 2016
http://www.rappler.com/business/industries/173-power-and-energy/143255-senator-manny-pacquiao-power-rates-system-loss

RATES'. Neophyte senator Manny Pacquiao asks the Department of Energy why consumers are being charged for system loss. Photo by Office of Senator Pacquiao

MANILA, Philippines – Senator Manny Pacquiao on Tuesday, August 16, asked Energy Secretary Alfonso Cusi a question that concerns ordinary Filipinos.

During the Senate inquiry into the simultaneous Luzon blackouts, Pacquiao questioned why consumers are being charged for system loss in their monthly electricity bills.

Power distribution firm Meralco defines system loss as "the recovery of power lost due to technical and non-technical system losses."

The charge, Meralco said, is collected "for the generation companies" and the National Grid Corporation of the Philippines (NGCP). The Energy Regulatory Commission (ERC) determines the rate to be collected.

For the senator, however, it is unfair to burden the people for system loss.

"Mr Secretary, this is a very important question, raise up ko ngayon. Ang tanong ko lang po, bakit n'yo china-charge sa consumers na talo n'yo na eh? That's business. Para sa akin 'di sya makatuwiran na i-charge sa consumers 'yung nalo-lose na power sa transmission," Pacquiao said.

(Mr Secretary, this is a very important question that I will raise now. My question is: Why are you charging consumers for what you've lost? That's business. For me, it's not reasonable to charge consumers for system loss.)

Cusi echoed Pacquiao's sentiment, adding consumers should not carry the burden for inefficiencies of power companies in delivering services.

The energy chief said he has already asked the Bureau of Internal Revenue to remove the value-added tax imposed on system loss.

"There are two components of system loss – technical and administrative loss. 'Yung technical, shineshare po ng lahat ng tao 'yun. 'Yung administrative, kung negligence ng service provider, 'wag po dapat ipasa sa tao (The technical, it's being shared by all consumers. The administrative, if it's due to negligence of the service provider, then it should not be passed on to the people)," Cusi said.

To which Pacquiao said: "I hope maaksyunan n'yo po. Isa po sa balakid sa mga consumers. Malaki binabayaran sa kuryente." (I hope you'll act on it. It's one of the burdens of consumers. They pay a lot for electricity.) – Rappler.com