The Department of Energy (DOE) has established a joint task force to lay the technical, regulatory, and legislative groundwork required to remove system loss charges and their corresponding value-added tax (VAT) from electricity bills, following a directive from President Ferdinand Marcos Jr.
Announced on Thursday, the task force brings together the DOE, the Energy Regulatory Commission (ERC), the National Electrification Administration (NEA), and electric cooperatives to oversee a comprehensive review of energy sector reforms.
According to the DOE:
”The Department of Energy (DOE) has established a Joint Task Force… to lead the next phase of implementing President Ferdinand R. Marcos Jr.’s directive to remove system loss charge and the corresponding Value-Added Tax (VAT) from consumers’ electricity bills.”
”The Joint Task Force will coordinate the technical, regulatory, and legislative work needed to advance the Administration’s commitment to fairer electricity rates, stronger consumer protection, and a more efficient power sector,” the department added.
The initiative follows President Marcos Jr.’s fifth State of the Nation Address (SONA 2026), in which he called on Congress to amend the Electric Power Industry Reform Act (EPIRA) to end the practice of shifting system loss costs and VAT onto end-users. Beyond legislative reform, the panel will focus on measures that boost operational efficiency and bolster grid reliability nationwide.
As part of preliminary steps, the DOE met with the ERC and Manila Electric Company (Meralco) on July 28 to map out short- and long-term regulatory actions.
”During the consultation, Meralco also expressed its commitment to exploring operational adjustments aimed at lowering electricity prices for its customers in the coming months, aligning with the collective goal of easing the financial burden on households and businesses,” the DOE stated in a separate release.
”As the country’s largest private distribution utility serving millions of customers, Meralco’s role is essential in identifying practical and workable approaches that support the administration’s consumer-first agenda.”
The policy push comes amid ongoing industry discussions over financial absorption, as Meralco Chairman Manny V. Pangilinan previously raised concerns regarding which entities would bear the burden of system losses once stripped from consumer billing.