The Philippine Electricity Market Corp. (PEMC) deregistered Millennium Energy Inc. (Millennium) in the Wholesale Electricity Spot Market (WESM) effective on April 1.
In its notice, Millennium sought for the cessation of its WESM membership following the non-renewal of the distribution wheeling service agreement with Manila Electric Co. (Meralco).
‘Wheeling’ is when a distributor transfers or allows the transfer of electricity over its network from a generator to a different customer. The DWSA is critical to the Millennium’s Navotas plant in particular, as it is connected only to the Meralco distribution grid and not the national grid as of yet.
Notwithstanding its cessation of registration, Millennium’s outstanding obligations and liabilities to the WESM shall remain valid and subsisting until fully settled, PEMC said.
Millennium Energy owns the two-unit 310-MW Navotas gas turbine power plant at the Navotas fish port, and the 620-MW Bataan combined cycle power plant in Limay, Bataan.
“PEMC followed its procedures in deregistering Millennium from its roster of WESM membership. The immediate impact will be the reduction of offers to be traded in the market that will result in the tightening of supply against the backdrop of increased demand during the summer months and forthcoming election day,” said PEMC President Melinda L. Ocampo.
Millennium has already met with Energy Regulatory Commission (ERC) an effort to resolve a dispute over a power supply agreement with Meralco.
ERC Chairman and CEO Jose Vicente Salazar told reporters in an earlier interview that despite Millennium’s good faith to tell the commission that the company is losing money and the distribution wheeling charges is too much for them to handle, it is still obliged to make its capacity available.
“However, since they have the capacity of 100MW, Millennium is obliged to offer this especially in the summer months. If they cannot dispatch it, then they will be held liable under PEMC rules, because [when]there is a capacity but you did not offer, it has an effect on price,” Salazar said.
Meanwhile, Meralco Senior Vice President Alfredo S. Panlilio said, “We’re just applying ERC approved distribution rates similar to what we’re charging other similarly situated customers / generators.”