Electricity spot-market rate seen rising in June

By Lenie Lectura May 29, 2020
https://businessmirror.com.ph/2020/05/29/electricity-spot-market-rate-seen-rising-in-june/

Prices in the Wholesale Electricity Spot Market Prices (WESM) could hit anywhere from P1.85 per kilowatt-hour to P4.27 per kWh in June, the Independent Electricity Market Operator of the Philippines Inc. (IEMOP) said Thursday.

IEMOP is the operator of WESM, the country’s electricity trading floor. Distribution utility firms partly source their requirements from WESM. In the May electricity bills, the Manila Electric Co. sourced 2 percent from WESM.

WESM price in June last year stood at P8.38 per kWh.

IEMOP COO Robinson Descanzo said during a virtual press briefing that WESM prices in June is expected to hit P1.85 per kWh based on an estimated peak demand of 12,153MW. Most parts of Luzon are expected to be placed under general community quarantine (GCQ) next month.

If peak demand goes up to13,368MW, WESM prices next month could hit P4.27 per kWh. He said this is based on a scenario wherein there is “aggressive opening of stranded businesses since the ECQ [enhanced community quarantine].”

The ECQ was implemented mid-March up to May 14. During the period, actual average supply was recorded at 13,340MW while actual average demand stood at 8,790MW. WESM prices during ECQ, stood at P1.77 per kWh.

Descanzo said demand peaked at 11,567MW on May 20 or May 21 during the modified ECQ.

“We have seen gradual increase in demand, especially when ECQ was modified. We expect higher demand in June when we shift to GCQ,” said Descanzo, adding that there is enough supply during the GCQ at an estimated 14,970MW.

The demand-supply scenario also affects WESM prices, explained Descanzo.

WESM prices in March, April and May this year were at P2.47 per kWh, P1.50 per kWh and P1.956 per kWh, respectively.

Last year, WESM prices hit P5.20 per kWh in March, P8.18 per kWh in April and P7.15 per kWh in May.