by Myrna Velasco July
29, 2016
With scheduled and
emergency shutdowns of power plants this week triggering yellow alert
conditions, eagle-eyed Energy Regulatory Commission (ERC) has advanced warning
to generation companies (GenCos) that it has been taking a close look at
consequent price surges in the spot market.
ERC Chairman Jose
Vicente B. Salazar stressed “we are aware of the situation and we have in fact
noted price surges during the past few days.”
It was gathered that prices
in the Wholesale Electricity Spot Market (WESM) had been hitting 7.00 per
kilowatt-hour (kWh) on average this week; and peaked to P20 per kilowatt-hour
as of Wednesday (July 27) with yellow alert condition in the Luzon grid.
Salazar noted “we have
identified the plants that have gone on unscheduled outages and if this
condition sustains for some time, we will look into the bidding patterns of
these plants.”
The ERC has been trying
to avert a situation reminiscent of when price spikes at the spot market hit
hardly on consumers’ pockets during the so-called November-December 2013
“perfect storm” in the power industry.
That was the period
when collusion raps had been thrown against the generation companies because of
simultaneous shutdowns and outages of power plants that had driven price hikes
of R4.00 to R5.000 per kilowatt- hour (kWh) in the case of major utility firm
Manila Electric Company.
The ERC has just
scheduled pre-trial hearings this August on the anti-competitive behavior cases
lodged against various GenCos and that of the Manila Electric Company from the
incidents three years ago.
On this week’s
development of thin reserves-induced upward price swings, Salazar said
“we may look further into this if we find reason to believe that the players have
taken advantage of the current supply deficit to drive up prices.”
He opined though that
“with the secondary price cap in place, we may not see the prices reaching
extraordinary levels.”
The power plants logged
to have experienced emergency shutdowns this week include the Sual
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