WESM prices down in November

MANILA, Philippines — Average wholesale electricity spot market (WESM) prices declined in November due to higher supply in the system, the Independent Electricity Market Operator of the Philippines (IEMOP) said.

The average rate in WESM decreased from P6.51 per kilowatt-hour (kWh) last month to P5.17 per kWh this month, IEMOP market simulation and analysis division manager John Paul Grayda said in a virtual media briefing.

“For November, the reason why we have lower rate is primarily because of the increase in supply,” he said.

IEMOP data showed supply rose from 13,374 megawatts (MW) to 14,246 MW.

“Following the Malampaya maintenance outage last month, some of the natural gas plants are already available,” Grayda said.

For next month, average WESM prices are expected to remain stable or even lower due to historical lower demand.

“In terms of historical results, in December we experience lower demand, and of course if there will not be much outage, we may see  close to P5 per kWh or even lower next month,” Grayda said.

For market developments in the pipeline, IEMOP president Richard Nethercott said the market operator is gearing up for the full implementation of WESM in Mindanao.

The IEMOP will launch WESM Mindanao on Dec. 26, but with a relaxed dispatch operations while full compliance with the dispatch standards is scheduled three months after or on March 25, 2022.

The three-month relaxed dispatch period is to give Mindanao generators time to adjust to the five-minute trading, according to IEMOP market information modelling manager Edward Olmedo.

“When we had commercial operations for the five-minute dispatch interval in Luzon and Visayas, we gave Luzon and Visayas generators three months to adjust their processes, infrastructure so they can have ample time to adjust to the compliance standards,” he said.

“What we’re envisioning in Mindanao is the same. Although we are implementing WESM central scheduling, we can see they’re still complying or forcing their contracts to be committed and dispatched in real time,” Olmedo said.

Only 40 out of 95 Mindanao participants have completed their registration with the IEMOP.

IEMOP registration and stakeholder services division manager Katrina Garcia-Amuyot said the low registration is due to participants that are still completing their compliance with the  requirements.