The Department of Energy (DOE) said it has averted a potential P7 increase in electricity rates, attributing the development to measures aimed at stabilizing power costs, as reported by RH Jecelle Ricafort.

Energy Secretary Sharon Garin said the avoided hike resulted from ongoing initiatives under the agency’s mandate to ensure an affordable and reliable energy supply. She noted that electricity rates could be further reduced if the value-added tax (VAT) on power charges were removed.

However, Garin emphasized that any proposal to eliminate the VAT requires careful study to assess its broader economic impact.

She said the decision does not rest with the DOE but with the country’s economic managers and Congress, given its wider implications on government revenues.

The DOE underscored the need to balance lower electricity costs with the government’s ability to fund public services. It added that the agency is prepared to provide technical input on how proposed tax changes may affect the energy sector, particularly in safeguarding consumers and maintaining fiscal sustainability.

The department also reiterated the importance of long-term reforms to reduce power costs, including improving generation efficiency, enhancing grid reliability, strengthening market competition, and promoting responsible energy use.

Meanwhile, on Monday, Sen. Risa Hontiveros filed Senate Bill 2076 seeking to remove the VAT on electricity system losses currently borne by consumers.