• Senate bill seeks to lower power rates

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    Funding for full electrification also pushed

    NEOPHYTE Senator Sherwin Gatchalian said on Friday he has filed a bill in the Senate that 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.

    Also on Friday, Senator Loren Legarda said she will push for full electrification of all barangays (villages) and households in the country through appropriate funding in the national budget as well as from the European Union’s (EU) support for the Philippines’ rural electrification targets.

    Gatchalian filed Senate Bill No. 1188, or the “Recoverable System Loss Act,” which seeks to lower the system loss cap from 8.5 percent to 5 percent for distribution utilities (DUs), and from 13 percent to 10 percent for electric cooperatives (ECs), respectively.

    The system loss cap is 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.

    The bill also seeks to prohibit electricity distributors from passing on other charges to consumers, such as 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, who is chairman of the Senate Committee on Energy.

    The bill also provides for a value-added tax (VAT) exemption for system loss charges.

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

    “We hope to help make electricity more affordable for Filipino households, which have to contend with some of the most expensive power rates in the world,” Gatchalian added.

    Full electrification

    Legarda, meanwhile, said she will push for appropriate funding for full electrification of all barangays, sitios (sub-villages), and households in the country.

    The senator, who chairs the Senate Committee on Finance, made the statement during the launching of the Access to Sustainable Energy Programme (ASEP) at the 4th EU-Philippine Meeting on Energy last October 7 at the Makati Shangri-la Hotel.

    “The country’s electrification profile shows that 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,” Legarda said.

    Most of those who have no access to electricity primarily live in the rural areas, which account for 4.4 million households, she said.

    “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 said.

    Legarda 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.

    But the electrification goals would need to be aligned with a low-carbon objective in the energy sector, she stressed.

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

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