Cheers and robust applause greeted President Marcos’ announcement during last Monday’s SONA that he wants system loss charges removed from power bills.
Systems loss on the monthly electricity bills refers to the cost of electricity lost during its transmission from the power plants and distribution to the consumers. This also includes losses from equipment and nontechnical issues such as theft of meters and wires as well as defects with electric meters.
For this purpose, Marcos called on Congress to amend the Electric Power Industry Reform Act (EPIRA) to remove the SL charge as well as the Value Added Tax (VAT) imposed on those charges.
While Malacanang’s effort to somehow ease the suffering of power consumers groaning under highest ever electricity prices is certainly welcome, it comes as no comfort for member-consumer-owners of the First Catanduanes Electric Cooperative, Inc. (FICELCO).
They have just learned that the residential power rate for July 2026, payable this week, is P19.3439 per kilowatt-hour.
Last June, the Philippines’ average residential electricity rate of P12.43 per kWh became the highest in the ASEAN region, topping Singapore’s average rate by P0.093 per kWh.
This month, the people of Catanduanes have the unenviable distinction of paying for the highest power rate in the country.
On a global basis, the Happy Island would be number 17 among nations with expensive electricity, with its residents paying US$0.31 per kWh.
And it may not take long before we come on the heels of the top three: Bermuda ($0.47), Ireland ($0.44), and Italy ($0.42).
As everyone may recall, the contract for the 5-megawatt diesel gensets rented by the National Power Corporation will expire on August 10, 2026, with any extension to be requested at least 20 days before the contract expiration.
Sources say that FICELCO board has already asked NPC to extend the Interim Power Supply Agreement (IPSA), as there remains a need for the additional power source.
The cooperative moved for the IPSA extension because the power it supplies to the grid enjoys government subsidy under the Universal Charge for Missionary Electrification (UCME).
The cheaper cost of the IPSA electricity translates into less expensive “blended” power rate when calculated to include the 8-megawatt Isla Dagyab Emergency PSA, the SUWECO diesel gensets and its hydroelectric power plants.
With the cost of diesel fuel back to more than a hundred pesos on the island, the True Cost Generation Rate (TCGR) is expected to shoot up to a level near the P34.5144 recorded in April 2026.
Power rates in Catanduanes rose to nearly P24/kWh, or US$0.39/kWh, this May and June, with the cooperative choosing to implement much lower rates that were recovered in the succeeding months.
It takes not much thinking to guess that for August 2026, the power rate will rise to the same level especially if NPC decides not to grant the IPSA extension.
If this happens, the only option for consumers is for their leaders at the provincial capitol and in Congress to personally appeal to the President to order NPC, the Department of Energy (DOE) and the Energy Regulatory Commission (ERC) to grant subsidy to the electricity produced under the Isla Dagyab EPSA.
Both the DOE and the ERC are reportedly in favor of granting the subsidy but the NPC board will have to include it in their application for UCME funding.
Only Malacanang intervention would suffice if Napocor refuses to extend the IPSA contract and the cheaper electricity it produces.