WESM prices spike to highest in 7 months

MANILA, Philippines — After hitting a two-year low last month, power rates in the Wholesale Electricity Spot Market (WESM) nearly doubled in March, driven by lower supply and higher demand due to hotter weather.

Latest data from the Independent Electricity Market Operator of the Philippines (IEMOP) showed that WESM rates soared by 95.5 percent to P5.34 per kilowatt-hour in March from P2.73 per kWh in February.

The March rate marks the highest in the past seven months or since August 2024’s P5.94.

For the Feb. 26–March 25 period, overall supply slipped by 4.4 percent to 19,611 megawatts from 20,512 MW previously as several power plants went into forced outage and operated at derated capacities.

System-wide demand, on the other hand, was higher by 5.9 percent to 13,670 MW from 12,904 MW on a monthly basis.

Arjon Valencia, IEMOP corporate planning and communications manager, attributed the increase in demand to the “extreme heat” during the first week of March.

The supply margin, Valencia said, declined to 3,957 MW from 5,725 MW, resulting in tighter system conditions.

The average spot prices in the major island groups all skyrocketed, with rates in Luzon going up by 102.7 percent to P5.50 per kWh, Visayas by 95.5 percent to P5.48 per kWh and Mindanao by 61.3 percent to P4.39 per kWh.

In Luzon, supply went down by 6.5 percent to 13,530 MW from 14,475 MW, while demand grew by 7.1 percent to 9,713 MW from 9,071 MW.

Last March 5, the first yellow alert this year was raised on the Luzon grid due to increased demand and the unplanned shutdown of some power plants.

A yellow alert is issued when the operating margin is insufficient to meet the generation’s contingency requirement.

In the Visayas grid, supply edged 1.3 percent lower to 2,365 MW in March from the preceding month’s 2,397 MW, while demand rose by two percent to 1,913 MW from 1,876 MW.

The supply in Mindanao, meanwhile, inched up by 2.1 percent to 3,716 MW from 3,640 MW, while the region’s demand climbed by 4.5 percent to 2,044 MW from 1,956 MW.

Operated by IEMOP, WESM is the centralized venue for buying and selling electricity as a commodity where prices are determined by supply and demand.

Despite the onset of the dry season, the Department of Energy expects no yellow and red alerts in the coming weeks, provided no additional plants face unplanned outages.