Regulator orders govt to formalize Visayas WESM bid

Manila Times.net
BY EUAN PAULO C. AÑONUEVO REPORTER

REGULATORS have ordered the Department of Energy (DOE) to validate its intention to commence with the operations of the electricity spot market in the Visayas. In a decision, the Energy Regulatory Commission (ERC) instructed the DOE, through state-administered Philippine Electricity Market Corp. (PEMC), to manifest whether the implementaion of the Wholesale Electricity Spot Market (WESM) Visayas would require modifications to existing rules or not.

“On the basis of information received and as indicated in newspaper publications, the [ERC] hereby takes judicial notice of the intended opening of the [WESM] in the Visayas region in 2010,” the regulator said.

The ERC asked the DOE and PEMC to file any needed changes in pricing, compensation and power plant dispatch rules in the spot market, which operates only in the Luzon grid.

If any changes are forthcoming for WESM Visayas, the ERC said that PEMC should file a petition within 30 days.

“Finally, PEMC is hereby directed to formulate price mitigating measures that should apply to the WESM in the Visayas grid, which may be in the form of price caps, bid caps, price thresholds or any other mechanism to mitigate the impact of potential volatile market prices upon the ordinary end-customer in the Visayas,” the ERC said.

PEMC earlier scheduled the start of WESM’s operations in the Visayas in 2008. But a power supply deficiency in the region brought about by growing demand, insufficient power generation and transmission constraints forced authorities to delay its implementation.

Energy Secretary Jose Rene Almendras however said that WESM Visayas operations may finally kick off next month once a number of technical issues concerning the spot market’s implementation are ironed out.

“I don’t want to call them problems, but they’re just issues that need to be addressed,” he had said.