Philippines: Gatchalian seeks lower pass-on power charges

Philippines: Gatchalian seeks lower pass-on power charges

Sen. Sherwin Gatchalian is seeking the immediate passage of a bill, which
seeks to lower electricity rates by as much as 15.67 centavos per kilowatt
hour through the reduction of charges passed on to consumers by power
companies.

Senate Bill 1188, or the proposed "Recoverable System Loss Act," lowers the
system loss cap - the maximum charge that can be passed on to consumers to
compensate for electricity lost in the distribution system from the
receiving point of private distribution utilities and electric cooperatives
to the consumer's metering point - from 8.5 percent to five percent for
distribution utilities, and from 13 percent to 10 percent for electric
cooperatives.

The bill also seeks to prohibit electricity distributors from passing on
other charges to consumers: non-technical system losses caused by
electricity theft or pilferage, and the electricity company's own power
expenses.

"Consumers should not be made to pay for what is ultimately the
responsibility of distribution utilities and electric cooperatives. It is
time for us to prioritize the welfare of Filipino households over the
interests of power sector insiders," said Gatchalian, the bill's author and
chairman of the Senate committee on energy.

Additionally, the bill provides for a value-added tax (VAT) exemption for
system loss charges.

If passed into law, Gatchalian estimates consumers could save as much as
P386 million per month in electricity costs.

In a related development, Sen. Loren Legarda is pushing for full
electrification of all barangays, sitios and households through funding in
the national budget as she welcomed the European Union's (EU) support for
the Philippines' rural electrification targets.

Legarda, chair of the Senate committee on finance, said the country's
electrification profile showed 89 percent of households in Luzon have power,
79 percent in the Visayas, and a very low 56 percent in Mindanao.

Urban electrification stood at 94 percent, while rural electrification in
the country stood at a low of 73 percent, she said.

She noted most of those who have no access to electricity primarily live in
the rural areas, which account for 4.4 million households living in remote
areas as well as in the outskirts of Metro Manila and Davao.

"We want these statistics to reach 100 percent by 2017 or in the next two
years, definitely before the 2020 original target. But we do not want just
statistics, we must ensure that indeed all barangays, sitios and households
in the country are electrified," she at the 4th EU-Philippine meeting of
Access to Sustainable Energy Programme (ASEP) last week.

She said she will look into how much funding assistance is available from
foreign sources and how much the government can provide as counterpart under
the General Appropriations Act (GAA) so that the country will not need to
wait until 2020 to achieve full electrification.

Through ASEP, the EU has allocated a grant of over P3 billion to assist the
Philippines to meet its rural electrification targets by means of renewable
energy and to promote energy efficiency.

The senator said electrification goals would need to be aligned with a
low-carbon objective in the energy sector.

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

Ref:
http://www.philstar.com/business/2016/10/12/1632601/gatchalian-seeks-lower-p
ass-power-charges

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com