# Philippines electricity system loss charge reform

> Live situation record from CLSTR: https://clstr.news/situations/philippines-electricity-system-loss-charge-reform
> Updated: 2026-07-31T04:23:32.000Z. Sources: 8. Developments: 2.

President Ferdinand Marcos Jr. first pledged to eliminate the system‑loss charge that appears on Meralco electricity bills, prompting applause and an ERC warning that a change to the 2001 Electric Power Industry Reform Act (EPIRA) would be required. The announcement caused a dip in Meralco’s share price.

Two days later Marcos urged Congress to amend EPIRA to bar the charge and its value‑added tax from being passed to consumers. Consumer groups and the Davao Consumer Movement welcomed the move but warned that without broader regulatory reforms the cost could be shifted elsewhere. The Mindanao Development Authority supported the amendment, citing potential regional economic benefits and disparities in loss‑recovery rates between private distributors and electric cooperatives.

In late July 2026 Marcos renewed the call to scrap the charge, this time with explicit backing from the Energy Regulatory Commission. Senate President Win Gatchalian filed legislation to abolish the charge, estimating industry‑wide costs at about PHP 45 billion. Meralco chairman Manny Pangilinan warned that absorbing the loss could threaten the utility’s viability. Senator Erwin Tulfo introduced a resolution and bills to amend EPIRA and exempt the charge from VAT. Consumer groups reiterated concerns that eliminating the charge alone may shift costs elsewhere, while the Mindanao Development Authority again welcomed the push, highlighting possible benefits for the region.

## Claims

- The system loss charge accounts for about 5%‑6% of a typical Philippine residential electricity bill. (single source)
- President Ferdinand Marcos Jr. called for the removal of the system loss charge in his 2026 State of the Nation Address. (single source)
- Senate President Win Gatchalian filed a bill to abolish the system loss charge. (single source)
- Meralco chairman Manny Pangilinan warned that removing the charge would cost the company tens of billions of pesos. (single source)
- Private distribution utilities in the Philippines may recover up to 5% of system loss, while electric cooperatives may recover up to 12.5%. (single source)
- Senator Erwin Tulfo filed Senate Resolution No. 537 and Senate Bills No. 2239 and 2340 to amend the EPIRA and exempt system loss charges from VAT. (single source)
- The Mindanao Development Authority welcomed the push to amend the EPIRA law, citing benefits for Mindanao. (single source)

## Timeline

### 2026-07-31: Philippines moves to scrap electricity system loss charge

President Marcos Jr. and Senate leaders push to eliminate the 5‑6% system loss charge on Philippine electricity bills, facing industry cost concerns and consumer‑group warnings of cost shifting.

4 sources. https://clstr.news/cluster/philippines-pushes-epira-amendment-to-eliminate-system-loss-charge-from-electricity-bills

### 2026-07-29: Philippines President Marcos vows to cut electricity system loss charges

President Marcos pledged to drop system loss charges from Philippine electricity bills, but the ERC says congressional action is needed and the cost burden remains uncertain; consumer groups urge a clear plan.

5 sources. https://clstr.news/cluster/philippines-president-marcos-vows-to-cut-electricity-system-loss-charges

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Cite as: Philippines electricity system loss charge reform. CLSTR, https://clstr.news/situations/philippines-electricity-system-loss-charge-reform