By JORDEENE
SHEEX LAGARE on
The Philippine
Electricity Market Corp.’s (PEMC) board of directors has approved the creation
of an independent market operator (IMO) to run the Wholesale Electricity Spot
Market (WESM) starting June.
In a statement, PEMC
said the operator would be a non-profit company, independent of government and
industry players, that shall take over WESM’s management from PEMC, which shall
remain the spot market’s governing body.
As part of preparations
for the transfer, a special meeting among market participants is set for
Tuesday. It shall tackle the composition of the PEMC membership; the
finalization and approval of amendments to the electricity market’s articles of
incorporation and by-laws; and the selection of IMO incorporators and initial
board members, based on the submissions of the PEMC board and transition
committee.
PEMC and the IMO shall
sign by the second quarter an agreement formalizing the turnover of the use of
the Market Management System and other trading platforms.
“This has been long
overdue; it has been delayed for more than a decade. Now is the best time to
usher in its independence, as provided in the law,” Energy Secretary Alfonso
Cusi told the PEMC board.
The approval came 16
years after Republic Act 9136, or the Electric Power Industry Reform Act of
2001 (Epira), was implemented. This law mandates that the entity operating WESM
shall be autonomous and made up of the DoE and representatives from the power
industry.
But PEMC has been
operating the spot market since 2003.
PEMC is a non-stock,
non-profit corporation that was incorporated in November 2003 upon the
initiative of the Department of Energy with representatives from the various
sectors of the electric power industry to be WESM’s governance arm.
The spot market is a
centralized venue for buyers and sellers to trade electricity as a commodity
where its prices are based on actual use (demand) and availability (supply).
It started commercial
operations in Luzon in June 2006 and in the Visayas in December 2010.
In June 2013, PEMC
integrated the Retail Competition and Open Access (RCOA) into the WESM.
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