WESM extends price ceiling by two months

Manila Standard Today
By Alena Mae S. Flores | Apr. 05, 2014 at 12:01am

A committee of the Wholesale Electricity Spot Market issued a directive extending the P32 per kilowatthour interim offer price cap by another 60 days to give time for more consultations in the power sector on the appropriate limit.

The joint resolution said the P32 per kWh cap was being extended from March 27, 2014 after the committee met and deliberated the recommendations of Philippine Electricity Market Corp., operator of the WESM, the country’s trading floor of electricity.

The committee “recognized that the existing timeline is tight for the conduct of public consultation.”

The tripartite committee, composed of the Energy Department, PEMC and the Energy Regulatory Commission, in a resolution in December last year reduced the interim offer price cap to P32 per kWh from P62 per kWh.

The committee said the market clearing prices during the 30-day Malampaya shutdown last year reached the maximum offer of P62 “more often than usual and even during off-peak hours when demand for electricity is low.”

The committee was created in 2006 to coordinate efforts to monitor price volatilities and set mitigation measures during the initial years of the WESM implementation.

The committee convened in December last year to discuss the possible adjustments to the price ceiling and recognized “the need to constantly put in place procedures and measures to address extreme price spikes or prolonged price volatility.” source