The implementation of the government-mandated lifeline rate collected by power distributors such as Meralco will undergo Senate scrutiny in light of growing complaints from consumers about spiking electricity bills.

Senate Resolution 375, filed by Senator Bam Aquino, directed the chamber’s committee on energy to review the design, targeting, and financing of the subsidy-related charges and mandated discounts under the Electric Power Industry Reform Act (RA 9136).

The call for the policy review follows public backlash regarding the so-called “pass-through” charges collected by power firms from consumers and remitted to the government. 

These charges, reflected in the billings, help fund government subsidy programs, such as the lifeline rate to support the monthly electricity bills of marginalized end-users, including beneficiaries of the Pantawid Pamilyang Pilipino Program (4Ps). 

On top of this, the mandated five percent discount for senior citizens, who consume 100 kWh or less per month, also adds to the costs being passed on to consumers.

Such collections are mandated under RA 11552, which amended RA 9136, passed in 2021 under the administration of former president Rodrigo Duterte.

Almost five years since the law took effect, and with the ongoing oil crisis jacking up electricity and fuel costs, Aquino stressed that it’s high time to review its implementation, asserting that the cross-subsidy charges should be partially, if not fully, covered by the national budget, not shouldered by the consumers.

“The objective of this policy review is not to remove or diminish the lifeline rate subsidy, but to ensure that it remains well-targeted, fiscally sustainable, and equitably financed, without unduly shifting the burden to other electricity consumers,” the resolution reads. 

Citing initial estimates, Aquino said subsidy-related charges may add several centavos per kWh or approximately P20 to P100 per month to the electricity bills of non-beneficiary households, depending on consumption levels.

Under Energy Regulatory Commission rules, qualified beneficiaries consuming between zero and 50 kWh per month may receive up to a 100 percent discount on applicable electricity charges.

Meralco has denied that these “passed-through charges” are company-imposed fees solely implemented by the firm, but are mandated by the law.

Meanwhile, Senator Risa Hontiveros pressed the ERC to launch a full, independent, and comprehensive review of existing practices and rates in relation to Meralco’s collections.

This came after the ERC ordered Meralco to swiftly refund over P14 billion to consumers from excessive charges that the power distributor has made over the years.

“Their refund is made in installments, but the huge increase in charges was abrupt. That’s not how the system should work. Before any increase is imposed, they must first refund the excess charges, and the billing should be corrected,” she pointed out.