ERC implements nat’l uniform subsidy rate for poor households

The Energy Regulatory Commission (ERC) on Friday announced it has approved the shift to a national uniform lifeline subsidy framework from previously being a distribution utility (DU)-specific scheme.

In a statement, the ERC said it has approved Resolution No. 02, Series of 2026 setting a “Uniform National Lifeline Subsidy and Rate for the implementation of the Lifeline Program nationwide."

The lifeline subsidy is a passed-on charge against regular-paying consumers to shoulder the discounted rates for the electricity consumption of low-income consumers.

P0.01 per kWh

Under the resolution, the power industry regulator established a national lifeline subsidy rate of P0.01 per kilowatt (kWh) to be collected from subsidizing end-users nationwide. 

The move was a shift from the previous DU-specific lifeline rates to a streamlined national measure in a bid to address disparities in subsidy levels and broaden the reach of the Lifeline Program to more households nationwide.  

Under its resolution, the ERC also adopted a uniform national lifeline consumption threshold of 0 to 50 kWh, “which entitles qualified marginalized end-users to a 100% discount on applicable electricity charges within this consumption level.”

The regulator clarified that for distribution utilities with existing approved thresholds above 50 kWh, the current discount structures for higher consumption levels will continue to apply until otherwise directed.

The ERC said the lifeline discount covers multiple components of the electricity bill, including generation, transmission, system loss, distribution, supply, metering, and applicable value-added tax (VAT), providing substantial relief to eligible households.  

It said that the adoption of a uniform national lifeline rate directly benefits low-income and marginalized electricity consumers by ensuring consistent and predictable discounts, regardless of their location or distribution utility. 

Lifeline Program

Those who can avail of the Lifeline Rate are the beneficiaries of 4Ps or customers considered to be living below the poverty threshold set by the Philippine Statistics Authority (PSA).

For consumers not enrolled in the Lifeline Program or those whose electricity consumption exceeds the lifeline threshold, the ERC said the P0.01 per kWh charge “represents a minimal and shared socialized charge that supports electricity affordability for vulnerable sectors, reinforcing the principle of equity in public utility services.”

All collections are treated as pass-through charges and do not form part of the utilities’ revenues, ensuring that the program does not distort operational costs or tariffs, according to the ERC.

The regulator said that the collected pass-through will be pooled into a National Lifeline Subsidy Fund, which will be administered by the Power Sector Assets and Liabilities Management Corporation (PSALM) “to transparently fund lifeline discounts granted to qualified beneficiaries.”

It added that the centrally administered Lifeline Subsidy Fund under PSALM “further strengthens accountability, transparency, and sustainability, with defined reporting, remittance, disbursement, and audit requirements, as well as annual reviews to ensure the sufficiency of the subsidy fund.”

The ERC said that the approval of the uniform national lifeline rate aligns with the state’s policy to protect public interest, promote inclusive access to electricity, and enhance the implementation of the Lifeline Program as mandated under the Electric Power Industry Reform Act (EPIRA), as amended by Republic Acts Nos. 10150 and 11552. —VAL, GMA Integrated News