Market operator preps for WESM-Mindanao setting up

Published November 18, 2016, 10:01 PM By Myrna M. Velasco

http://business.mb.com.ph/2016/11/18/market-operator-preps-for-wesm-mindanao-setting-up

The Philippine Electricity Market Corporation (PEMC) preps for the setting up of the permanent Wholesale Electricity Spot Market (WESM) in Mindanao grid by June next year.

That has been based on the directive set out by Energy Secretary Alfonso G. Cusi, with him noting that a spot market in the southernmost grid is now warranted to help in the re-channeling and sale of capacities not underwritten by bilateral contracts.

He noted that while there is now sufficient capacity for Mindanao, there are still areas experiencing “energy poverty” – which is an irony for a market already well-supplied with power. The Mindanao spot market is seen as recourse both for power generators that do not have supply contracts, and for off-takers (capacity buyers) that do not have a definite source on their power requirements.

Additionally, WESM-Mindanao will be a network for the priority and must-dispatch policy proposition for renewable energy (RE) technologies – the next terrain of massive investments that the grid has been aspiring for.

“After DOE’s (Department of Energy) issuances declaring for WESM Mindanao, we expect information campaign then participants’ training to follow,” PEMC President Melinda L. Ocampo has noted.

She added that the next steps will include “hands-on training and trial operations” for all prospective market participants in the Mindanao grid.

“We are planning to use our NMMS (new market management system) just like in our Luzon and Visayas operations,” Ocampo said.

The propounded institutionalization of the Mindanao spot market is well-timed with the proposed commercial operations of the WESM’s new and advanced trading platform – with some adjustments on trading intervals and price settlements that must be adhered to by market participants.

It must be noted that Mindanao grid’s first spot market foray had been via the defunct Interim Mindanao Electricity Market (IMEM). It was later shelved due to problems with market buyers.

Nevertheless, when supply problems had already been resolved for Mindanao, the clamor for the establishment of a functioning and indissoluble spot market for the grid had intensified.