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Ninth Congress

Republic Act No. 7832 December 8, 1994

AN ACT PENALIZING THE PILFERAGE OF ELECTRICITY AND
THEFT OF ELECTRIC POWER TRANSMISSION
LINES/MATERIALS, RATIONALIZING SYSTEM LOSSES BY
PHASING OUT PILFERAGE LOSSES AS A COMPONENT
THEREOF, AND FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the
Philippines in Congress assembled:
Section 1. Short Title. - This Act shall be referred to as the "Anti-
electricity and Electric Transmission Lines/Materials Pilferage Act of
1994."
Section 2. Illegal Use of Electricity. - It is hereby declared unlawful for
any person, whether natural or juridical, public or private, to:
(a) Tap, make or cause to be made any connection with overhead
lines, service drops, or other electric service wires, without
previous authority or consent of the private electric utility or rural
electric cooperative concerned; 1awphil@alf

(b) Tap, make or cause to be made any connection to the existing

electric service facilities of any duly registered consumer without
the latter's or the electric utility's consent or authority;
(c) Tamper, install or use a tampered electrical meter, jumper,
current reversing transformer, shorting or shunting wire, loop
connection or any other device which interferes with the proper or
accurate registry or metering of electric current or otherwise
results in its diversion in a manner whereby electricity is stolen or
wasted;
(d) Damage or destroy an electric meter, equipment, wire or
conduit or allow any of them to be so damaged or destroyed as to
interfere with the proper or accurate metering of electric current;
and
(e) Knowingly use or receive the direct benefit of electric service
obtained through any of the acts mentioned in subsections (a), (b),
(c), and (d) above. 1awphil@alf

Section 3. Theft of Electric Power Transmission Lines and Materials. -

(a) It is hereby declared unlawful for any person to:
(1) Cut, saw, slice, separate, split, severe, smelt, or remove
any electric power transmission line/material or meter from a
tower, pole, or any other installation or place of installation or
any other place or site where it may be rightfully or lawfully
stored, deposited, kept, stocked, inventoried, situated or
located, without the consent of the owner, whether or not the
act is done for profit or gain;
(2) Take, carry away or remove or transfer, with or without the
use of a motor vehicle or other means of conveyance, any
electric power transmission line/material or meter from a tower,
pole, any other installation or place of installation, or any place
or site where it may be rightfully or lawfully stored, deposited,
kept, stocked, inventoried, situated or located without the
consent of the owner, whether or not the act is done for profit
or gain;
(3) Store, possess or otherwise keep in his premises, custody
or control, any electric power transmission line/material or
meter without the consent of the owner, whether or not the act
is done for profit or gain; and
(4) Load, carry, ship or move from one place to another,
whether by land, air or sea, any electrical power transmission
line/material, whether or not the act is done for profit or gain,
without first securing a clearance/permit for the said purpose
from its owner or the National Power Corporation (NPC) or its
regional office concerned, as the case may be.
(b) For purposes of this section, "electrical power transmission
line/material" refers to electric power transmission steel towers,
woodpoles, cables, wires, insulators, line hardwares, electrical
conductors and other related items with a minimum voltage of
sixty-nine kilovolts (69 kv), such as the following:
(1) Steel transmission line towers made of galvanized steel
angular members and plates or creosoted and/or lannelized
woodpoles/ concrete poles and designed to carry and support
the conductors;
(2) Aluminum conductor steel reinforced (ACSR) in excess of
one hundred (100) MCM;
(3) Overhead ground wires made of 7 strands of galvanized
steel wires, 3.08 millimeters in diameter and designed to
protect the electrical conductors from lightning strikes;
(4) Insulators made of porcelain or glass shell and designed to
insulate the electrical conductors from steel towers or
woodpoles; and
(5) Various transmission line hardwares and materials made of
aluminum alloy or malleable steel and designed to
interconnect the towers, conductors, ground wires, and
insulators mentioned in subparagraphs (1), (2), (3), and (4)
above for the safe and reliable operation of the transmission
lines. 1awphil©

Section 4. Prima Facie Evidence. - (a) The presence of any of the

following circumstances shall constitute prima facie evidence of illegal
use of electricity, as defined in this Act, by the person benefitted
thereby, and shall be the basis for: (1) the immediate disconnection by
the electric utility to such person after due notice, (2) the holding of a
preliminary investigation by the prosecutor and the subsequent filing in
court of the pertinent information, and (3) the lifting of any temporary
restraining order or injunction which may have been issued against a
private electric utility or rural electric cooperative:
(i) The presence of a bored hole on the glass cover of the
electric meter, or at the back or any other part of said meter;
(ii) The presence inside the electric meter of salt, sugar and
other elements that could result in the inaccurate registration
of the meter's internal parts to prevent its accurate registration
of consumption of electricity;
(iii) The existence of any wiring connection which affects the
normal operation or registration of the electric meter;
(iv) The presence of a tampered, broken, or fake seal on the
meter, or mutilated, altered or tampered meter recording chart
or graph, or computerized chart, graph, or log;
(v) The presence in any part of the building or its premises
which is subject to the control of the consumer or on the
electric meter, of a current reversing transformer, jumper,
shorting and/or shunting wire, and/or loop connection or any
other similar device;
(vi) The mutilation, alteration, reconnection, disconnection,
bypassing or tampering of instruments, transformers, and
accessories;
(vii) The destruction of, or attempt to destroy, any integral
accessory of the metering device box which encases an
electric meter, or its metering accessories; and
(viii) The acceptance of money and/or other valuable
consideration by any officer of employee of the electric utility
concerned or the making of such an offer to any such officer or
employee for not reporting the presence of any of the
circumstances enumerated in subparagraphs (i), (ii), (iii), (iv),
(v), (vi), or (vii) hereof: Provided, however, That the discovery
of any of the foregoing circumstances, in order to constitute
prima facie evidence, must be personally witnessed and
attested to by an officer of the law or a duly authorized
representative of the Energy Regulatory Board (ERB).
(b) The possession or custody of electric power transmission
line/material by any person, natural or juridical, not engaged in the
transformation, transmission or distribution of electric power, or in
the manufacture of such electric power transmission line/material
shall be prima facie evidence that such line/material is the fruit of
the offense defined in Section 3 hereof and therefore such
line/material may be confiscated from the person in possession,
control or custody thereof.
Section 5. Incentives. - An incentive scheme by way of a monetary
reward in the minimum amount of Five thousand pesos (P5,000) shall
be given to any person who shall report to the NPC or police
authorities any act which may constitute a violation of Section 3
hereof. The Department of Energy (DOE), in consultation with the
NPC, shall issue the necessary guidelines for the proper
implementation of this incentive scheme within thirty (30) days from
the effectivity of this Act.
Section 6. Disconnection of Electric Service. - The private electric
utility or rural electric cooperative concerned shall have the right and
authority to disconnect immediately the electric service after serving a
written notice or warning to that effect, without the need of a court or
administrative order, and deny restoration of the same, when the
owner of the house or establishment concerned or someone acting in
his behalf shall have been caught en flagrante delicto doing any of the
acts enumerated in Section 4(a) hereof, or when any of the
circumstances so enumerated shall have been discovered for the
second time: Provided, That in the second case, a written notice or
warning shall have been issued upon the first discovery: Provided,
further, That the electric service shall not be immediately disconnected
or shall be immediately restored upon the deposit of the amount
representing the differential billing by the person denied the service,
with the private electric utility or rural electric cooperative concerned or
with the competent court, as the case may be: Provided, furthermore,
That if the court finds that illegal use of electricity has not been
committed by the same person, the amount deposited shall be
credited against future billings, with legal interest thereon chargeable
against the private utility or rural electric cooperative, and the utility or
cooperative shall be made to immediately pay such person double the
value of the payment or deposit with legal interest, which amount shall
likewise be creditable against immediate future billings, without
prejudice to any criminal, civil or administrative action that such person
may be entitled to file under existing laws, rules and regulations:
Provided, finally, That if the court finds the same person guilty of such
illegal use of electricity, he shall, upon final judgment, be made to pay
the electric utility or rural electric cooperative concerned double the
value of the estimated electricity illegally used which is referred to in
this section as differential billing.
For purposes of this Act, "differential billing" shall refer to the amount
to be charged to the person concerned for the unbilled electricity
illegally consumed by him as determined through the use of
methodologies which utilize, among others, as basis for determining
the amount of monthly electric consumption in kilowatt-hours to be
billed, either: (a) the highest recorded monthly consumption within the
five-year billing period preceding the time of the discovery, (b) the
estimated monthly consumption as per the report of load inspection
conducted during the time of discovery, (c) the higher consumption
between the average consumptions before or after the highest drastic
drop in consumption within the five-year billing period preceding the
discovery, (d) the highest recorded monthly consumption within four
(4) months after the time of discovery, or (e) the result of the ERB test
during the time of discovery and, as basis for determining the period to
be recovered by the differential billing either: (1) the time when the
electric service of the person concerned recorded an abrupt or
abnormal drop in consumption, or (2) when there was a change in his
service connection such as a change of meter, change of seal or
reconnection, or in the absence thereof, a maximum of sixty (60)
billing months up to the time of discovery: Provided, however, That
such period shall, in no case, be less than one (1) year preceding the
date of discovery of the illegal use of electricity.
Section 7. Penalties. - (a) Violation of Section 2. - The penalty of
prision mayor or a fine ranging from Ten thousand pesos (P10,000) to
Twenty thousand pesos (P20,000) or both, at the discretion of the
court, shall be imposed on any person found guilty of violating Section
2 hereof.
(b) Violation of Section 3. - The penalty of reclusion temporal or a
fine ranging from Fifty thousand pesos (P50,000) to One hundred
thousand pesos (P100,000) or both at the discretion of the court,
shall be imposed on any person found guilty of violating Section 3
hereof.
(c) Provision common to violations of Section 2 and Section 3
hereof. - If the offense is committed by, or in connivance with, an
officer or employee of the power company, private electric utility or
rural electric cooperative concerned, such officer or employee
shall, upon conviction, be punished with a penalty one (1) degree
higher than the penalty provided herein, and forthwith be
dismissed and perpetually disqualified from employment in any
public or private utility or service company and from holding any
public office.
If, in committing any of the acts enumerated in Section 4 hereof, any of
the other acts as enumerated is also committed, then the penalty next
higher in degree as provided herein shall be imposed.
If the offense is committed by, or in connivance with an officer or
employee of the electric utility concerned, such officer or employee
shall, upon conviction, be punished with a penalty one (1) degree
higher than the penalty provided herein, and forthwith be dismissed
and perpetually disqualified from employment in any public or private
utility or service company. Likewise, the electric utility concerned which
shall have knowingly permitted or having knowledge of its commission
shall have failed to prevent the same, or was otherwise guilty of
negligence in connection with the commission thereof, shall be made
to pay a fine not exceeding triple the amount of the 'differential billing'
subject to the discretion of the courts.
If the violation is committed by a partnership, firm, corporation,
association or any other legal entity, including a government-owned or
-controlled corporation, the penalty shall be imposed on the president,
manager and each of the officers thereof who shall have knowingly
permitted, failed to prevent or was otherwise responsible for the
commission of the offense.
Section 8. Authority to Impose Violation of Contract Surcharges. - A
private electric utility or rural electric cooperative may impose
surcharges, in addition to the value of the electricity pilfered, on the
bills of any consumer apprehended for tampering with his electric
meter/metering facility installed on his premises, as well as other
violations of contract like direct connection, use of jumper, and other
means of illicit usage of electricity found installed in the premises of
the consumer. The surcharge for the violation of contract shall be
collected from and paid by the consumer concerned as follows:
(a) First apprehension. - Twenty five percent (25%) of the current
bill as surcharge;
(b) Second apprehension. - Fifty percent (50%) of the current bill
as surcharge; and
(c) Third and subsequent apprehensions. - One hundred percent
(100%) of the current bill as surcharge.
The private electric utility or rural electric cooperative is authorized to
discontinue the electric service in case the consumer is in arrears in
the payment of the above imposed surcharges.
The term 'apprehension' as used herein shall be understood to mean
the discovery of the presence of any of the circumstances enumerated
in Section 4 hereof in the establishment or outfit of the consumer
concerned.
Section 9. Restriction on the Issuance of Restraining Orders or Writs
of Injunction. - No writ of injunction or restraining order shall be used
by any court against any private electric utility or rural electric
cooperative exercising the right and authority to disconnect electric
service as provided in this Act, unless there is prima facie evidence
that the disconnection was made with evident bad faith or grave abuse
of authority.
If, notwithstanding the provisions of this section, a court issues an
injunction or restraining order, such injunction or restraining order shall
be effective only upon the filing of a bond with the court, which shall be
in the form of cash or cashier's check equivalent to the "differential
billing," penalties and other charges, or to the total value of the subject
matter of the action: Provided, however, That such injunction or
restraining order shall automatically be refused or, if granted, shall be
dissolved upon filing by the public utility of a counterbond similar in
form and amount as that above required: Provided, finally, That
whenever such injunction is granted, the court issuing it shall, within
ten (10) days from its issuance, submit a report to the Supreme Court
setting forth in detail the grounds or reason for its order.
Section 10. Rationalization of System Losses by Phasing out
Pilferage Losses as a Component Thereof . - There is hereby
established a cap on the recoverable rate of system losses as follows:
(a) For private electric utilities:
(i) Fourteen and a half percent (14 1/2%) at the end of the first
year following the effectivity of this Act;
(ii) Thirteen and one-fourth percent (13 1/4%) at the end of the
second year following the effectivity of this Act;
(iii) Eleven and three-fourths (11 3/4%) at the end of the third
year following the effectivity of this Act; and
(iv) Nine and a half-percent (9 1/2%) at the end of the fourth
year following the effectivity of this Act.
Provided, That the ERB is hereby authorized to determine at the
end of the fourth year following the effectivity of this Act, and as
often as necessary taking into account the viability of private
electric utilities and the interest of the consumers, whether the
caps herein or theretofore established shall be reduced further
which shall, in no case, be lower than nine percent (9%) and
accordingly fix the date of the effectivity of the new caps: Provided,
further, That in the calculation of the system loss, power sold by
the NPC or any other entity that supplies power directly to a
consumer and not through the distribution system of the private
electric utility shall not be counted even if the billing for the said
power used is through the private electric utility.
The term "power sold by NPC or any other entity that supplies
power directly to a consumer" as used in the preceding paragraph
shall for purposes of this section be deemed to be a sale directly
to the consumer if: (1) the point of metering by the NPC or any
other utility is less than one thousand (1,000) meters from the
consumer, or (2) the consumer's electric consumption is three
percent (3%) or more of the total load consumption of all the
customers of the utility, or (3) there is no other consumer
connected to the distribution line of the utility which connects to
the NPC or any other utility point of metering to the consumer
meter.
(b) For rural electric cooperatives:
(i) Twenty-two percent (22%) at the end of the first year
following the effectivity of this Act;
(ii) Twenty percent (20%) at the end of the second year
following the effectivity of this Act;
(iii) Eighteen percent (18%) at the end of the third year
following the effectivity of this Act;
(iv) Sixteen percent (16%) at the end at the fourth year
following the effectivity of this Act; and
(v) Fourteen percent (14%) at the end of the fifth year following
the effectivity of this Act.
Provided, That the ERB is hereby authorized to determine at the
end of the fifth year following the effectivity of this Act, and as often
as is necessary, taking into account the viability of rural electric
cooperatives and the interest of the consumers, whether the caps
herein or theretofore established shall be reduced further which
shall, in no case, be lower than nine percent (9%) and accordingly
fix the date of the effectivity of the new caps.
Provided, finally, That in any case nothing in this Act shall impair
the authority of the ERB to reduce or phase out technical or design
losses as a component of system losses.
Section 11. Area of Coverage. - The caps provided in Section 10 of
this Act shall apply only to the area of coverage of private electric
utilities and rural electric cooperatives as of the date of the effectivity
of this Act.
The permissible levels of recovery for system losses in areas of
coverage that may be added on by either a private electric utility or a
rural electric cooperative shall be determined by the ERB.
Section 12. Recovery of Pilferage Losses. - Any private electric utility
or rural electric cooperative which recovers any amount of pilferage
losses shall, within thirty (30) days from said recovery, report in writing
and under oath to the ERB: (a) the fact of recovery, (b) the date
thereof; (c) the name of the consumer concerned, (d) the amount
recovered, (e) the amount of pilferage loss claimed, (f) the explanation
for the failure to recover the whole amount claimed, and (g) such other
particulars as may be required by the ERB. If there is a case pending
in court for the recovery of a pilferage loss, no private electric utility or
rural electric cooperative shall accept payment from the consumer
unless so provided in a compromise agreement duly executed by the
parties and approved by the court.
Section 13. Information Dissemination. - The private electric utilities,
the rural electric cooperatives, the NPC, and the National
Electrification Administration (NEA) shall, in cooperation with each
other, undertake a vigorous campaign to inform their consumers of the
provisions of this Act especially Sections 2, 3, 4, 5, 6, 7, and 8 hereof,
within sixty (60) days from the effectivity of this Act and at least once a
year thereafter, and to incorporate a faithful condensation of said
provisions in the contracts with new consumers.
Section 14. Rules and Regulations. - The ERB shall, within thirty (30)
working days after the conduct of due hearings which must commence
within thirty (30) working days upon the effectivity of this Act, issue the
rules and regulations as may be necessary to ensure the efficient and
effective implementation of the provisions of this Act, to include but not
limited to, the development of methodologies for computing the
amount of electricity illegally used and the amount of payment or
deposit contemplated in Section 7 hereof, as a result of the presence
of the prima facie evidence discovered.
The ERB shall, within the same period, also issue rules and
regulations on the submission of the reports required under Section 12
hereof and the procedure for the distribution to or crediting of
consumers for recovered pilferage losses.
Section 15. Separability Clause. - Any portion or provision of this Act
which may be declared unconstitutional or invalid shall not have the
effect of nullifying other portions or provisions hereof.
Section 16. Repealing Clauses. - The provisions in Presidential
Decree No. 401, as amended by Batas Pambansa Blg. 876, penalizing
the unauthorized installation of electrical connections, tampering
and/or knowing use of tampered electrical meters or other devices,
and the theft of electricity are hereby expressly repealed. All other
laws, ordinances, rules, regulations, and other issuances or parts
thereof, which are inconsistent with this Act, are hereby repealed or
modified accordingly.
Section 17. Effectivity Clause. - This Act shall take effect thirty (30)
days after its publication in the Official Gazette or in any two (2)
national newspapers of general circulation.
Approved: December 8, 1994 lawphi1Ÿ

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