Sen. Sherwin Gatchalian is seeking the immediate passage of a bill, which 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.
Senate Bill 1188, or the proposed “Recoverable System Loss Act,” lowers the system loss cap – 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 – from 8.5 percent to five percent for distribution utilities, and from 13 percent to 10 percent for electric cooperatives.
The bill also seeks to prohibit electricity distributors from passing on other charges to consumers: non-technical system losses caused by electricity theft or pilferage, and the electricity company’s own power expenses.
Additionally, the bill provides for a value-added tax (VAT) exemption for system loss charges.
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