Danessa Rivera (The Philippine Star)
- January 31, 2020 - 12:00am
MANILA, Philippines — The country’s electricity
spot market operator sees a repeat of elevated spot market prices this year due
to anticipated tightness of supply amid an expected increase in demand as well
as slow development of new power plants.
In a briefing yesterday, Independent
Electricity Market Operator of the Philippines Inc. (IEMOP) said effective
settlement spot prices (ESSPs) averaged P5.43 per kilowatt-hour (kwh) last
year, higher than the P3.69 per kwh in 2018, P3.37 per kwh, in 2017, and P3.33
per kwh in 2016.
In the past year, the highest ESSP
was recorded in June at P8.38 per kwh while the lowest was registered at P2.18
per kwh in September.
IEMOP said last year’s average price
was 57 percent higher than the average prices of the previous three years.
It attributed the increase to
“thinning supply margins as available generation capacities are now unable to
adequately support the increasing demand given the heightened occurrence of
forced and maintenance outages and insufficient development of new generation
capacities.”
IEMOP chief operating officer
Robinson Descanzo said the series of unplanned plant outages should be a signal
to check the operating efficiency of power plants.
Meanwhile, natural calamities and
delayed entry of additional capacity into the grid also played a major role in
the rise in spot market prices, he said.
Several power plants and
transmission lines were affected by the 6.5-magnitude earthquake in Zambales in
April, and by typhoons Tisoy and Ursula in December.
On the other hand, the commercial
operations of the 355-megawatt (MW) Unit 3 of the Masinloc power plant
and the 455-MW San Buenaventura power plant, which were expected to come in
during the hot months, only started operations in the second half.
For this year, IEMOP expects peak
demand to grow by 5.6 percent to 14,191 MW. This means an additional of 700 MW
capacity is needed to be injected into the grid—around 500 MW in Luzon and
nearly 200 MW in Visayas, Descanzo said.
“But we don’t have additional power
plants coming in before summer. They will come in only after summer,”
Descanzo said.
He was referring to the entry of the
GN Power Dinginin coal power plant with 668 MW, which is expected to be online
in June.
“With the expected increase in
demand, tight supply conditions and price spikes are likely to happen
particularly during the summer period. This underscores the need for new
generation capacities to meet increasing demand and to help prevent recurrence
of high market clearing prices,” Descanzo said.
IEMOP’s findings will be reported to
the Department of Energy (DOE) in preparation for the summer period.
‘We’ll just highlight the impact of
tight supply, so maybe they can accelerate the plants that are commissioning,”
Descanzo said.
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