The country’s sole operator of the wholesale electricity spot market (WESM) released on Tuesday the trial operation guidelines and test plan for Mindanao participants.
The release dovetailed the promulgation of circular by the Department of Energy declaring the launch of wholesale electricity spot market (WESM) in Mindanao and providing for transition guidelines, according to Philippine Electricity Market Corporation (PEMC)
The WESM 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)
The trial operation program which shall start on 26 June 2017 contains preparatory activities to familiarize all Mindanao participants in the implementation of the WESM via the market systems and procedures to be deployed.
Mindanao participants include generation companies, distribution utilities (electric cooperatives and private distribution utilities), bulk-users that are directly connected to the transmission grid, and the National Grid Corporation of the Philippines as the System Operator and Metering Services Provider.
“PEMC is committed in its mandate of operating an electricity market for the whole country that will usher in transparency and competition in the generation sector,” PEMC President Melinda L. Ocampo said.
Mindanao participants are expected to be involved in the end-to-end testing of all interfaces and systems that will involve simulations of all processes such as registration, bid submission, pricing and scheduling, and settlement.
A kick-off meeting was held in General Santos City on 25 May 2017 to discuss the market systems to be deployed. On-site installation of user access interfaces was also undertaken.
Prior to the kick-off meeting, hands-on trainings were done to prepare the participants. At present, 29 participants signified their intention to participate in the trial operations.
Several capacity-building activities are also in the offing while the trial operations program are ongoing to ensure that participants are ready for the integration of Mindanao in the WESM.
The integration of Mindanao to the WESM would cover, among others, the following: 1) application of the ERC-approved Price Determination Methodology for pricing and settlement of electricity transactions in the Mindanao grid, 2) utilization of the Market Management System (MMS) for the determination of dispatch schedules in the Mindanao grid, 3) provision of access to Mindanao generators and customers to the MMS for the submission of bids, offers, and self-schedules, and other trading functions, 4) real-time publication of wholesale prices for electricity in the Mindanao grid in the public website, and 5) eligibility of Mindanao stakeholders for membership in the Philippine Electricity Market Board and its various committees.
The WESM was created by Republic Act 9136 or the Electric Power Industry Reform Act of 2001 to establish an electricity market that reflects the actual cost of electricity and to lower electricity cost through competition.