In a significant step toward reducing electricity costs, the Department of Energy (DOE) has formed a joint task force to eliminate system loss charges and their accompanying value-added tax (VAT) from consumers' bills. This initiative comes in response to President Ferdinand “Bongbong” Marcos Jr.'s directive.
Task Force Composition and Objectives
The Joint Task Force will coordinate the technical, regulatory, and legislative work needed to advance the Administration's commitment to fairer electricity rates.
Department of Energy
The DOE's task force will facilitate collaboration between various stakeholders, including electric cooperatives and private distribution utilities. This collaborative approach aims to ensure that reforms not only protect consumer interests but also enhance the long-term reliability of the Philippine power sector.
During his fifth State of the Nation Address on July 25, 2026, Marcos urged Congress to amend the Electric Power Industry Reform Act (EPIRA) to eliminate these charges, which have long been a burden for consumers.
Meralco chairman Manuel V. Pangilinan expressed concerns regarding the potential financial implications of removing these charges, while also acknowledging the necessity of recognizing system loss as an operational reality faced by all distribution utilities.
The DOE is committed to engaging all relevant parties to identify solutions that not only reduce costs for consumers but also improve the efficiency of electricity services. This includes legislative amendments and regulatory reforms.
The establishment of this task force signals a serious commitment to reform in the energy sector, which has historically faced criticism for high costs and inefficiencies. The DOE plans to work closely with Congress and other stakeholders to ensure these reforms are effectively implemented.
The DOE's initiatives also include measures to reduce system losses at their source through enhanced operational efficiencies and stricter enforcement against electricity theft. The department has expressed gratitude to President Marcos for his proactive stance on reforming system loss charges.