Mindanao WESM Market Participants Update Today

THE REGION
By MIKE BAÑOS
April 11, 2019

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MCPC insists no legal basis for Mindanao WESM

 

The independent operator of the Philippines’ Wholesale Electricity Spot Market will conduct its first Market Participants Update today, 11 April 2019, at the Limketkai Luxe Hotel in Cagayan De Oro City.

“With the theme Growth Through Inclusivity, #MPU2019 will apprise participants on various market developments, tackle issues and concerns with respect to operations, and provide updates on WESM Mindanao implementation,” said Atty. Francis Saturnino P. Juan, President and Chief Executive Officer of the Independent Electricity Market Operator of the Philippines Inc. (IEMOP).

 IEMOP is a non-stock, non-profit corporation, led by a board of directors comprised entirely of independents, “who do not have any interest or connection to the WESM participants” which took over the operation of the WESM effective 26 September, 2019 vice the Philippine Electricity Market Corporation (PEMC).

 “IEMOP now operates the wholesale electricity sport market (WESM) managing the registration of market participants, receipt of generation offers, setting market prices and dispatching schedules of the generation plants, billing, settlement and collections,” Juan said.

PEMC remains as the governing body for WESM to monitor market participants’ compliance of market rules, in compliance with the policy and regulatory oversight of the Department of Energy (DOE) and the Energy Regulatory Commission (ERC).

Update Highlights

Among the topics to be discussed during the half day event are Market Operations Highlights by Engr. Robinson P. Descanzo, Trading Operations Head; Market Systems & Mindanao Integration Update by Engr. Jose Mari T. Bigornia, Chief Operating Officer; Market Developments & Rule Changes by Engr. Isidro E. Cacho, Jr., Chief Corp. Strategy & Communications Officer and WESM Processes (Registration, Market Network Model, Trading, Metering, Settlements) by Engr. Edward I. Olmedo, Market  Information Modeling Manager.

Break Out Groups

Parallel presentations on the Retail Electricity Market by Engr. Eric Niño U. Louis, Corporate Communications Manager and WESM Governance by Atty. Oscar E. Ala, PEMC President follow.

An Open Forum moderated by Atty. Rachel Angela P. Anosan, IEMPO Chief Legal Officer caps the half day event.

No legal basis for WESM

Despite the IEMOP’s optimism, a Mindanao based consumer group maintains there is no legal basis to proceed with a Mindanao WESM at this time.

“The establishment of a Mindanao Wholesale Electricity Spot Market was initiated in 2016 by the coal generating companies in Mindanao to enable them to sell their power to distribution utilities at prices higher than rates approved by the ERC in the power sales agreements of the gencos with the electric cooperatives and investor-owned distribution utility companies,” said Clint Django Pacana, secretary-general of the Mindanao Coalition of Power Consumers (MCPC).

In a position paper previously submitted to the ERC, MCPC maintains the establishment of the MWESM will inevitably result in higher prices for power supplies being paid by Mindanao power consumers.

Although the Association of Mindanao Rural Electric Cooperatives (AMRECO) submitted to the DOE a dispatch protocol that would cap the ceiling prices in the proposed MWESM to rates approved by the ERC in the power sales agreements of Mindanao coal gencos with Mindanao distribution utilities, it was rejected by two of the coal gencos, and not adopted by the DOE for endorsement to the ERC.

No Vis-Min Interconnection, No Minda WESM

In the same paper, MCPC alleges the MWESM violates the EPIRA since the conditions for the extension to Mindanao of the Philippine WESM do not yet exist.

“Unless the Visayas-Mindanao Interconnection which would enable electricity to be moved from Visayas to Mindanao and vice-versa is already operational, it is illegal to have WESM operate in Mindanao,” said Engr. David A. Tauli, MCPC president. \

“It should be noted that the extension of the WESM from Luzon to the Visayas was only done after a Luzon-Visayas interconnection was constructed that had adequate capacity to move bulk generation to Luzon from the geothermal power plants in the Visayas,” Tauli stressed.

No enabling law

The MCPC further maintains that no enabling law has been submitted to Congress that would allow an isolated WESM to be established in Mindanao. 


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