‘Step up probe into WESM rule violations’


The Department of Energy (DOE) has directed the Philippine Electricity Market Corp. (PEMC) to speed up its investigation into the alleged violations of the “must-offer” rule of the Wholesale Electricity Spot Market (WESM).

Energy Secretary Carlos Jericho Petilla, who is also chairman of PEMC Board, said this is the only way to address the problem, noting that when he assumed office, the PEMC investigation covered alleged violations that happened as far back as two to three years ago.

“I told them (PEMC) effective immediately, all investigations will have to be as updated as possible,” Petilla said, advising the PEMC to conduct investigations into transactions made as recent as the previous month.

“If they don’t have enough personnel, they could hire people – whatever it takes so that the investigation would be monthly,” he said.

Petilla defended the decision of the PEMC to penalize companies, including the state-run Power Sector Assets and Liabilities Management Corp. (PSALM), for violation of the “must-offer” rule of the WESM.

“These findings are as a result of in-depth findings, bearing in mind that all involved were given a chance to explain their actions,” he said.

In the case of PSALM, however, Petilla said the agency failed to submit an explanation, which led to the decision finding it ‘guilty’ of the charge.

“In the case of PSALM, it did not explain its side, so next time you (should) answer, because if you do not respond, you are guilty,” said Petilla.

Apart from the PSALM, Therma Mobile Inc. (TMO), a subsidiary of Aboitiz Power Corp. was also fined P234.9 million for a similar offense covering the period of October to December 2013.

Petilla, however, clarified that the result of PEMC’s investigation is independent from the investigation of the Energy Regulatory Commission (ERC).

“The intention of the penalty was on the violation of the rules; it is inconclusive as far as the ERC investigation is concerned, they are totally separate,” he added.

Given the hefty amount of penalties involved, Petilla said the DOE is pushing for information dissemination about the WESM rules and education of traders.

Petilla is urging traders to secure a license from the WESM before they are allowed to trade on the electricity market.

“I am now pushing for WESM accreditation, you have to have a license to trade. If you don not have WESM accreditation, you cannot trade,” he said, noting that many traders are still unfamiliar with the rules of WESM.


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