Mindanao Interim Power Market launch set this week

Manila Bulletin 
By Myrna Velasco
September 17, 2013 
While still addressing hurdles on the dispatch protocol, the Philippine Electricity Market Corporation (PEMC) is scheduling to launch this week the long-anticipated Interim Mindanao Electricity Market (IMEM) which may soak up un-contracted capacities that could help shore up supply in the energy-scrimping grid.

The design of the Mindanao electricity market will be slightly modified because the distribution utilities (DUs) will be the ones forecasting their demand; and which will then be telling the market the volume they need.

The DUs can then decide to purchase their supply from the spot market depending on how much they could afford to pay for the available capacity, or they may just opt to disconnect their customers.

Energy Secretary Carlos Jericho L. Petilla and other industry stakeholders perceive it to be a “demand-side bidding” scheme, although for PEMC president Melinda L. Ocampo, it is a system still parallel to the supply-side bidding design for the Luzon and Visayas wholesale electricity spot markets.

After the scheduled September 20 launch of the IMEM, Petilla noted that the Mindanao market may need another one month to address the weaknesses of the real-time dispatch of capacities set for trading into the market.

“With that phase of trial dispatch, no settlement will happen yet,” the energy chief stressed, adding that the dry-run on trading “will proceed depending on how long it will take for the dispatch protocol to be in place.”

Petilla said they are expecting embedded as well as un-contracted capacities to be channeled through the market; and such volume may be bought by power utilities which are having supply shortfalls.

Ocampo averred that “the responsibility to forecast the demand was given to DUs and ECs (electric cooperatives) since they have the right information on the actual level of their customers’ consumption.”

The Mindanao electricity market, she said, will largely “encourage the participation of load curtailment resource by using their own genset (generator set) so we can free up their load requirements from the system and let others use it.”

Based on initial assessment of the energy department, the capacities that could go into the market may hover between 150 to 200MW, but that will still depend on the willingness of the parties, especially the embedded generators, to offer their capacities.   source