Curious about the different charges you see on your electricity bill? It is about time that you understand and get to know the different charges you see on your bill.

Generation Charge

This is the composite cost of electricity generated and sold to a distribution utility such as Visayan Electric. 

Transmission Charge
It is 
the cost of transmitting power from the generation source to the receiving point of a distribution utility.

Systems Loss Charge

It is the cost of power loss recovery due to technical and non-technical system loss for delivering power to the end users.

Distribution Charge
It is the cost of developing, constructing, operating and maintaining the distribution system,which delivers power from high-voltage transmission grids to end-users. This is the only charge that goes to Visayan Electric. 

Customer Charge
A. Supply/Customer Charge
It is the cost of billing, collection and various customer-related services.

B. Metering Charge
It is the cost associated with measuring the amount fo energy consumed which include meter, meter-installations, accessories and meter reading.

Lifeline Subsidy Discount
RA 9136 provides that inter-class subsidies shall be removed, except the lifeline rates applicable to marginalized or low income residential electricity users. Visayan Electric's lifeline is set at 100 kWh. This discount is applicable only to the generation, transmission, distribution, supply, metering and the systems loss charges.

The Energy Regulatory Commission has set 
Visayan Electric's lifeline rate subsidy as follows:

Kwh ConsumptionDiscount*
20 & below

*Discount on Generation, Transmission, Distribution, Systems Loss Charge, Supply Charge, Metering Charge

Lifeline Rate Subsidy
This will cover the aid (subsidy) given to marginalized (Lifeline Rate) customers. The Uniform Retail Rate structure specified in R.A. 9136 makes it subsidy-free. It means that inter-class subsidies currently enjoyed under the existing rate structure shall be removed.

Currency Exchange Rate Adjustment
This is the recovery of the increase in principal payments of foreign denominated loans that may be brought about by the peso devaluation.

Power Act Reduction
Upon effectivity of R.A. 9136, NPC is mandated to reduce its rates for residential customers by 30 centavos per kilowatt-hour. since 
Visayan Electric buys only about 50% of its power needs from NPC, its Power Act Reduction would amount to more or less 15 centavos only. Visayan Electric has three Independent Power Producers - Toledo Power Corporation (TPC), Cebu Private Power Corporation (CPPC) and East Asia Utilities Corporation.

National Franchise Tax
Refers to 2% of gross revenue remitted to the national government as national franchise tax.

Local Franchise Tax
A range of 0.5% to 0.75% of gross revenue goes to local government as local franchise tax.

Universal Charge
It is a non-bypassable charge determined, fixed and approved by the Energy Regulatory Commission to be imposed on all electricity end-users. This is remitted to the Power Sector Assets and Liabilities Management (PSALM), owned and controlled by the government. This would include:

  1. Stranded costs/contracts of NPC. Payment for the NPC debts after sale of its generating assets in excess of the amount assumed by the National Government.
  2. Missionary Electrification. R.A. 9136 mandates NPC to carry on with its missionary function of providing electricity to non-viable, far-flung areas in the countryside even after its privatization.
  3. Environmental Charge. The amount of P0.0025 per kilowatt hour shall be collected from all end users. This environmental fund will be managed by NPC, to be used solely for watershed rehabilitation and management.
  4. Tax Equalization. It is the equalization of the taxes and royalties applied to indigenous or renewable source of energy vis-a-vis imported energy fuels.
  5. Stranded Costs/Contracts of Utilities. This refers to the distribution utilities' losses in value of generating assets and contracts approved by the ERB before December 31, 2000 as a consequence of industry deregulation.
This amount represents two percent (2%) of previous unpaid bills.

Local Franchise Tax Recovery

This is the computed amount to recover the local franchise tax imposed by the local government in your city or municipality from 1994-2000, which was not passed on the consumers.