Photo courtesy of Avito Dalan/PNA
Senator Erwin Tulfo said responsibility for reducing system loss should extend beyond power distributors, as the Senate examined ways to cut electricity costs and improve efficiency across the energy sector.
During the Senate energy committee hearing on August 20, Tulfo questioned distribution utilities, electric cooperatives, generation companies and industry groups on measures they were taking to reduce losses.
Meralco said its technical system loss stood at 3.39 percent in 2025. The utility cited upgrades to more efficient distribution transformers, which it said reduced energy losses while requiring only a modest increase in equipment costs.
Visayan Electric and Davao Light also reported continuing infrastructure upgrades, including new substations, higher-capacity lines and other projects intended to keep technical losses below regulatory limits.
Electric cooperatives, meanwhile, are increasingly turning to technology to address nontechnical losses. Philreca cited advanced metering systems that can detect illegal connections, meter tampering and damaged lines, while Visayas cooperatives reported using artificial intelligence to flag unusual consumption patterns.
Generation companies maintained that system loss does not directly fall within their operations but said improving power plant efficiency could help keep electricity supply costs competitive.
The Energy Regulatory Commission said consumers’ recovery of system loss charges could eventually be reduced or prohibited, but warned that reforms would require proper tariff adjustments, transition periods and incentives to avoid putting financially vulnerable electric cooperatives at risk.
Tulfo also pushed for removing value-added tax on system loss charges as a more immediate way to provide relief to consumers. The ERC is expected to issue a resolution on the matter on August 26.