Mindanao WESM to start operations in mid-2017

MANILA, Philippines - The energy department is seeking inputs from industry stakeholders as it sets the implementation of an electricity spot market in Mindanao in mid-2017.

In a draft circular, the Department of Energy has declared the launch of Wholesale Electricity Spot Market (WESM) in the Mindanao grid on June 26, 2017.

However, the start of WESM Mindanao’s commercial operations will depend on meeting the criteria set by the DOE.

The agency has ordered Philippine Electricity Market Corp. (PEMC), the country’s power spot market operator, to submit a certification on the status of the criteria 15 days prior to the launch date.

The criteria include putting in place systems and procedures needed in operating the spot market; conducting of training programs; assurance in the forecasting, scheduling, dispatch, pricing, metering, and settlement processes of WESM; securing the approval from the Energy Regulatory Commission of the price determination methodology; and approval of an independent auditor on the method to be used.

Industry stakeholders are given until Jan. 30 to submit their comments on the implementation of WESM Mindanao.

Once approved, the DOE said all electric power industry participants in Mindanao will be considered registered WESM members and are required to submit registration documents in the WESM.

PEMC will conduct trial operations with Mindanao WESM participants and the National Grid Corp. of the Philippines (NGCP) to ensure their readiness for the WESM commercial operations.

WESM Mindanao will replace effectively replace the Interim Mindanao Electricity Market (IMEM), which was set up in 2013 as the region’s trading floor for electricity.

IMEM was suspended in February 2014 following a grid-wide power interruption in the region, preventing power companies with excess generating capacity to offer their output to distribution utilities (DUs).

Apart from instances of power interruptions during its operations, PEMC also faced the difficulty of getting payments from DUs for the capacity bought in IMEM.