WESM’s search for independent market operator hangs

by Myrna Velasco October 25, 2015

Another administration will end its reign next year, but the Wholesale Electricity Spot Market (WESM) still fails to transfer its management and supervision to an independent market operator (IMO).

Given nagging questions on the spot market’s IMO shift, Philippine Electricity Market Corporation (PEMC) President Melinda L. Ocampo has indicated that PEMC is now up for it and had already submitted final recommendations to the Department of Energy (DOE).

“We’re done with several public consultations… we’re just awaiting for the DOE.

That will now depend on their determination,” she told reporters recently.

The changeover of the WESM management to an IMO will similarly propel the government’s exit from its administration of the power spot market.

That should have been a milestone achieved as early as 2008 or two years after the WESM’s commercial operation or during the tailend of the Arroyo administration.

However, the government opted to commission a study first that will aid them as to what form the IMO would be and how its management and board shall be constituted.

When the proposed IMO Board framework was presented to the industry last year though, it had drawn opposition from the players of the power industry.

Industry players opined that since the board memberships will be scouted from various disciplines, they may not necessarily have expertise in electricity spot market operations – which is crucial in ascertaining operational dilemmas as well as other problems that may strain the entire industry.

Under a draft Circular earlier issued by the energy department, the IMO Board shall be composed of seven members – to be selected from array of stakeholders.

It shall include an economist with at least five years experience, a member of the academe who has a doctorate degree; a finance person who shall also have five years of experience; a lawyer who shall be a senior partner of a law firm for at least 15 years; an engineer who has expertise in the operation of transmission or generation systems; and a director of a publicly-listed company.