MANILA – Electricity subsidies and mandated discounts should be funded through the national budget instead of being passed on to consumers, a senator said Tuesday.
In Senate Resolution 375, Senator Bam Aquino called for an inquiry into the design, targeting, and financing of the lifeline rate subsidy and other electricity discounts to ensure their “fair and sustainable implementation without placing undue burden on electricity consumers.”
“Busisiin natin ang karagdagang bayad na ito. Marami nang naghihirap na Pilipino at middle class. Hindi na dapat dagdagan ang gastusin ng taumbayan kung may pera naman ang gobyerno para sa ayuda (Let us scrutinize these additional charges. Many Filipinos, including the middle class, are already struggling. The public should not bear additional costs if the government has funds for assistance),” Aquino said.
The resolution seeks to review the current cross-subsidy mechanism, where discounts granted to marginalized users are recovered from other electricity consumers, raising concerns over equity and sustainability.
“Current reliance on cross-subsidy mechanisms results in a redistribution of costs that may place a disproportionate and cumulative burden on non-beneficiary consumers, particularly low- and middle-income households who do not qualify for existing subsidies,” Aquino said.
Based on initial estimates cited in the resolution, subsidy-related charges may add several centavos per kilowatt-hour, or about PHP20 to PHP100 per month, to the electricity bills of non-beneficiary households, depending on consumption levels.
Aquino said exploring alternative financing, including partial or full funding through the national budget, could improve transparency, accountability, and sustainability of subsidy programs.
“Mahalagang malaman natin ang sistema ng pangongolekta at hindi ito napapasan ng mga kapwa naghihirap na kababayan natin sa middle class (It is important to understand how these are collected and ensure that the burden is not carried by fellow Filipinos who are also struggling in the middle class),” he said.
Under Section 73 of Republic Act 9136, or the Electric Power Industry Reform Act, a lifeline rate provides discounted electricity bills for marginalized end-users who have difficulty paying at full cost, while Republic Act 11552 expanded the coverage to include households under the Pantawid Pamilyang Pilipino Program.
Rules issued by the Energy Regulatory Commission allow qualified beneficiaries consuming up to 50 kilowatt-hours per month to receive discounts of up to 100 percent, based on standardized eligibility criteria implemented in January 2026.
The resolution noted that while the lifeline rate remains a vital social protection measure, its current design may result in additional charges reflected in electricity bills.
Senior citizens, meanwhile, receive a 5 percent discount on electricity consumption of up to 100 kWh per month under Republic Act 9994, which may likewise contribute to costs being borne by other users.
“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,” Aquino said. (PNA)