PCCI backs removal of system loss charge, power VAT, but…
MANILA, Philippines — The country’s largest business organization supports the removal of systems loss charges and value-added tax (VAT) on electricity, noting these would reduce power costs for households and industries.
“The removal of systems loss and associated VAT on electricity provides immediate relief, but it must be followed by broader reforms to truly ease the burden on consumers and industries,” Philippine Chamber of Commerce and Industry (PCCI) president Ferdinand Ferrer said.
“Our competitiveness depends on reliable and affordable power today while building sustainability for tomorrow. We cannot afford to let high energy costs continue to erode investment and industrial growth,” he added.
In his latest State of the Nation Address, President Marcos called for the scrapping of systems loss charges being passed on consumers to reduce electricity cost.
PCCI director for energy and power David Chua said that businesses and consumers are already burdened with numerous pass-through fees.
“Removing systems loss and VAT is a welcome start, but the bigger challenge lies in rationalizing other charges, diversifying our energy mix and unlocking indigenous resources,” he said.
The group underscored the importance of ensuring 24/7 supply for manufacturing operations and other investments through reliable baseload.
It also emphasized the need for regulatory and market efficiency including managing the transition from feed-in-tariff allowance subsidies to green energy auction allowance or competitive renewable procurement.
In addition, PCCI pushed for a diversified energy mix that includes natural gas, liquefied natural gas, renewables, energy storage and emerging technologies like hydrogen and nuclear.
To reduce reliance on imports, it said the country needs to expand energy exploration efforts to unlock untapped domestic reserves.
Through faster transmission expansion, streamlined permitting and a flexible electricity market, the PCCI said the country would ensure that new generation capacity reaches consumers efficiently and projects move without delay.
“These reforms will ensure that power supply is not only affordable but also resilient against global price shocks,” Chua said.
The PCCI said it is committed to working with the government and all stakeholders for a realistic and sustainable energy roadmap that supports businesses.
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