AS market launch to be moved next year


The launch date for the trading of electricity from ancillary services (AS) or reserve power would be moved to 2022, according to the Independent Electricity Market Operator of the Philippines (IEMOP), which operates the Wholesale Electricity Spot Market (WESM).

IEMOP spokesperson Andrea Mae Caguete said it has filed the rules on the reserve market with the Rules Change Committee. WESM’s operator, she added, has also done several activities regarding the reserve power market’s implementation.

WESM’s rules and their related market manual have to be be updated with the impending entry of the reserves market, according to Valfia Uy-Gregorio, senior specialist of IEMOP’s Market Design and Business Development Division. The changes in the rules will be examined by the Energy Regulatory Commission (ERC), the Philippine Electricity Market Board, and the Department of Energy (DOE).

Gregorio added that the Price Determination Methodology will require the ERC’s approval once the implementation of the reserves market is given a go.

Energy Asec. Redentor Delola said last May that the DOE aimed to commence the AS market’s operations by year’s end.

Power to be traded in the AS market include the regulating, contingency and dispatchable reserves. Once in place, the National Grid Corporation of the Philippines can already purchase electricity as needed to prevent sudden power outages. The reserves market would also encourage investors to put up facilities for this purpose.

IEMOP added that WESM Mindanao must be in effect first before the reserves market becomes operational. The Mindanao spot market is expected to go online in the fourth quarter,

Relative to this, AC Energy President and CEO Eric Francia called for the implementation of WESM Mindanao, so that the government’s green energy option program (GEOP) can be implemented.

“The elephant in the room, unfortunately, is that Mindanao cannot yet enjoy this benefit Why? Because there is no spot market yet. Therefore, there’s no RCOA (retail competition and open access) yet [in Mindanao]. It is critical for Mindanao to open the WESM,” Francia said in a virtual forum organized by Davao-based businessmen last week.

GEOP and RCOA, both government programs which aim to lower electricity costs, allow contestable customer to choose retail electricity suppliers (RESs) that can provide them power at a lower cost instead of distribution utilities in their areas of operation.

At the moment, only contestable customers consuming at least 500 kilowatts (kW) monthly are eligible for RCOA. GEOP’s threshold, meanwhile, is only at 100kW. In addition, GEOP RESs get their electricity from clean energy sources.