IEMOP qualified to manage WESM -DOE

doe-orders-review-of-ngcps-transmission-development-plan

The Department of Energy (DOE) defended  the Independent Electricity Market Operator of the Philippines (IEMOP), claiming that it has experience in operating the Wholesale Electricity Spot Market (WESM).

The DOE released this statement after Puwersa ng Bayaning Atleta party-list Rep. Jericho Nograles questioned the contract acquisition of IEMOP on the management of WESM. 

“The system was transferred to IEMOP based on the Operating Agreement between  Philippine Electricity Market Corporation (PEMC) and IEMOP dated 18 September 2018 and people running the system were disengaged from PEMC and hired by IEMOP,” the DOE said in a statement to the media. 

“Hence, IEMOP was a “spin off” of PEMC towards independence in market operations,” it added.

DOE Secretary Alfonso Cusi was the former chair of PEMC, which used to manage market operations. 

Cusi gave up the chairmanship with the condition that market operations should be handled by an independent corporation with the necessary experience and expertise. 

DOE further claimed that the contract wasn’t a “sweetheart deal” as a Transition Plan was followed in accordance with the law.

In addition, it expounded that a competitive selection process was not required because competitive bidding was only mandated for foreign participants as an option under the EPIRA.

“The DOE opted to create a separate entity composed of Filipinos who have acquired the necessary expertise to operate the WESM and ensure that the market will be managed by Filipinos,” it explained.

 Nograles called on House of Representatives’ committee on energy to investigate the IEMOP’s acquisition as the lawmaker claimed that IEMOP sealed the agreement with only P7,000 in paid-up capital. This resulted in earning “more than P100 million in months.” 

“The ‘sweetheart deal’ made it possible for IEMOP to grow from a P7,000 capitalization to become a multimillion outfit with a total declared income of more than P100 million for the end of 2018. This will need a lot of explaining,” Nograles said.

Nograles further claimed earlier that IEMOP has no experience and no assets to serve as the operator of the WESM based on the documents submitted.