Two bills were filed in the Senate on Tuesday seeking to remove system loss charges and the value-added tax (VAT) on consumers' electricity bills, in line with President Ferdinand Marcos Jr.'s push to reduce power costs during the final two years of his administration.

Senators JV Ejercito and Erwin Tulfo filed their respective twin measures a day after Marcos, in his penultimate State of the Nation Address (SONA), urged Congress to amend the 25-year-old Electric Power Industry Reform Act (EPIRA) amid mounting complaints over bill shock caused by pass-through charges.

Under Ejercito's Senate Bill No. 2342, or the proposed Consumer Protection Against System Losses Act, distribution utilities and electric cooperatives would be prohibited from passing system losses on to consumers as a separate line item on their electricity bills.

"Consumers should only pay for the electricity they actually use and the services they receive. If you didn't use the electricity, you shouldn't have to pay for it," Ejercito said.

System loss refers to electricity lost during transmission and distribution as power travels from generation plants through high-voltage transmission lines and distribution networks to homes and businesses.

Currently, a portion of system loss that falls within the limits set by the Energy Regulatory Commission (ERC) may be passed on to consumers.

At Manila Electric Co. (Meralco), the country's largest power distributor, system loss accounts for about 5 percent of a customer's electricity bill.

The EPIRA allows distribution utilities, such as Meralco, to automatically recover pass-through costs from consumers, including system loss charges.

Senate Bill No. 2342 also directs the ERC to amend its existing policies within 90 days of the law's effectivity to remove system loss as a separate item on electricity bills.

Aside from system loss charges, consumers also pay a 12-percent VAT imposed on these charges.

Tulfo's Senate Bill No. 2340 seeks to remove the 12-percent VAT on system loss charges, which he said further increases electricity costs.

Tulfo, chairman of the Senate Committee on Energy, has already begun hearings on proposed amendments to the EPIRA. The committee is scheduled to hold another hearing on 30 July.

Tulfo told reporters the committee aims to approve the proposed measures before the end of the year.