The Energy Regulatory Commission (ERC) reaffirmed its support for measures seeking to reduce the system loss burden on electricity consumers, while emphasizing the need to consider the technical and operating conditions of distribution utilities (DUs).
ERC Chairperson and CEO Atty. Francis Saturnino Juan conveyed the Commission’s position during the public hearing of the Senate Committee on Energy, jointly with the Committee on Public Services, held on 13 August 2026 at the Secretariat Building, Philippine International Convention Center (PICC), Pasay City.
The hearing took up four pending Senate bills addressing system losses in the power sector. The proposed measures seek to strengthen system loss regulation, reduce recoverable system loss rates, and limit the system losses that may be passed on to electricity consumers.
Juan emphasized the importance of balancing consumer protection with the technical realities faced by DUs.
“We fully support the goal underlying these measures—to lower the system loss burden on electricity consumers.”
“We fully support the goal underlying these measures—to lower the system loss burden on electricity consumers. This is a goal that we share and fully support,” the ERC chief said.
For its part, the ERC supports Senate Bill No. 495, which seeks to institutionalize the differentiated system loss cap framework established under ERC Resolution No. 20, Series of 2017.
The Commission said the differentiated caps recognize legitimate differences in geography, topology, feeder length, and consumer density, while the proposed performance improvement requirements would require DUs to implement concrete measures to reduce system losses over time.
Meanwhile, the ERC supports Senate Bill Nos. 1083 and 1237, particularly the provisions on mandatory performance improvement schemes, administrative penalties for non-compliant DUs, individualized caps, and a three-year regulatory review.
However, the Commission raised reservations over the proposed uniform caps for electric cooperatives, noting that utilities operating in remote or geographically challenging areas may face conditions that cannot be addressed through management intervention alone.
At the same time, the ERC raised serious concerns over Senate Bill No. 2131, particularly its proposed one-percent cap on technical system losses. The Commission noted that an immediate requirement at this level could result in widespread non-compliance and financial risks for DUs, given the prevailing technical loss levels in the country.
“There is a need for a realistic transition that protects consumers while maintaining the financial viability of utilities serving vulnerable communities.”
The ERC nevertheless reiterated its support for efforts to eliminate non-technical losses arising from pilferage, illegal connections, and meter tampering, costs of which consumers should not have to bear. The Commission emphasized the need for a realistic transition that protects consumers while maintaining the financial viability of utilities serving vulnerable communities.
Moving forward, Juan said the ERC remains ready to work with the Senate, the Department of Energy (DOE), and the energy family in developing effective and sustainable system loss reforms.
“We stand ready to provide whatever technical data, regulatory analysis, or cost-impact studies the Committee may require. We are prepared to implement any legislative reform that Congress enacts,” he concluded.
