Home Editors Picks Knowing system loss charge and how it can lower down electricity bill

    Knowing system loss charge and how it can lower down electricity bill


    Paying utility bills every month is like a way of life. But, most people do not really pay attention to the charges that make up the bill.


    In Davao Light and Power Co. and in all distribution utilities, the electricity bill is unbundled. Meaning, various components of electricity tariffs are itemized and segregated for transparency to paying customers. However, not all customers understand these charges. One best example of these is the system loss charge.


    System loss is simply the difference between the power purchased from energy sources and the power sold to customers. It is attributed to two components; technical and non-technical losses. Technical losses occur naturally and consist mainly of power dissipation or heat generated in electricity system components such as transformers, transmission and distribution lines. Meanwhile, on-technical losses are caused by actions external to the power system and an example of which is electricity theft.


    Under the R.A. 9136 or Electric Power Industry Reform Act (EPIRA) Law of 2001, electric utilities like Davao Light can recover the power lost through the system loss charge. However, a utility can only recover up to a set ceiling of 8.5% as implemented by the Energy Regulatory Commission (ERC). Otherwise, the distribution utility absorbs he system loss in excess of the cap.


    Even so, Davao Light only charges its customers the actual system loss which is lower than the cap. Hence, Davao Light customers pay less in terms of amount per kWh. As of February 2013, Davao Light’s cumulative system loss is only at 7.29% which is lower compared to other electric utilities and cooperatives.


    For example, with Davao Light’s system loss at 7.29%, the residential customer with a monthly consumption of 175 kWh currently saves P11.71 or P140.52 in a year. This would not have been enjoyed by him had the company system loss exceeded the mandated cap.


    To sustain a below cap system loss, Davao Light continuously invests in state-of-the-art equipment and upgrades its systems. It also is serious in its campaign against electricity theft or pilferage. These strategies are of significance to the electric utility as it does not want to pass on its inefficiency to its customers.


    Text and photo source: Davao Light and Power Company Official Facebook Page

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    Hi, I am Richard Diongson, a lifestyle blogger from the Philippines. I love travelling to different places, trying out different food every now and then. I love social events like gathering of bloggers, themed parties, showbiz personalities gathering, and the like. Four (4) Interesting (little-known) facts about me: A. It may not show but I love farm living. In fact I have farm back in the province. B. I am single. lol C. I don't know how to ride a motorcycle yet but I am very excited to learn now that I have decided to buy a new one. D. I am writer and a social media influencer. Pet Peeves: A. I really find bullying annoying and unacceptable. It is just not right. B. I hate people who don't show up during a scheduled meeting/appointment whether in or out of work. C. People who "get cheap on me".