Senator Bam Aquino has filed a resolution seeking a Senate review of electricity subsidy financing, pushing to move Lifeline rates and other mandated discounts off consumers’ electricity bills and into the national budget.

Aquino made the statement on Tuesday, in Senate Resolution No. 375, which calls on the Committee on Energy to review the design, targeting, and funding mechanism of electricity subsidies under Republic Act No. 9136 or the Electric Power Industry Reform Act.

“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,” Aquino said. (“Let’s scrutinize this additional charge. Many Filipinos and the middle class are already struggling. The people should not be made to shoulder additional expenses if the government has funds for assistance.”)

He added concerns over how subsidy costs are being passed on to consumers.

“Mahalagang malaman natin ang sistema ng pangongolekta at hindi ito napapasan ng mga kapwa naghihirap na kababayan natin sa middle class,” he said. (“It is important to understand the system of collection and ensure that this is not being borne by our fellow struggling citizens in the middle class.”)

Aquino warned that existing cross-subsidy mechanisms may be creating a cost structure that disproportionately affects non-beneficiary households.

“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,” he said in the resolution.

The resolution cited initial estimates showing subsidy-related charges could add several centavos per kilowatt-hour (kWh), or around PHP 20 to PHP 100 per month to electricity bills depending on consumption levels.

Under existing policy, lifeline subsidies under Section 73 of Republic Act No. 9136 provide discounted electricity rates for low-income households. Republic Act No. 11552 expanded eligibility to include beneficiaries of the Pantawid Pamilyang Pilipino Program (4Ps).

The Energy Regulatory Commission rules allow households consuming 0kWh to 50 kWh per month to receive up to a 100% discount on applicable electricity charges.

Senior citizens also receive a 5% discount on electricity bills for consumption up to 100 kWh per month under Republic Act No. 9994 or the Expanded Senior Citizens Act of 2010.

Aquino clarified that the intent of the review is not to remove existing subsidies but to reassess their funding structure.

“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,” he said.

The proposal adds to ongoing policy discussions on electricity affordability and the design of social protection measures in the power sector.

Should electricity subsidies in the Philippines be funded through the national budget or remain embedded in electricity billing systems?

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