The Energy Regulatory Commission (ERC) has issued clarificatory guidelines on the implementation of the Modified Administered Price (MAP) in the Wholesale Electricity Spot Market (WESM) as part of efforts to stabilize electricity costs during market suspension periods under the ongoing State of National Energy Emergency.

In a statement dated May 8, the ERC said Resolution No. 14, Series of 2026 addresses operational and settlement concerns raised by industry stakeholders during the recent market suspension. The commission said the guidelines are intended to help protect consumers from unnecessary electricity price volatility while maintaining orderly market operations.

One of the key provisions of the resolution is the adoption of a one-time Bilateral Contract Quantity (BCQ) redeclaration mechanism for coal-fired power plants that were available but constrained or curtailed due to instructions from the system operator.

The BCQ refers to the volume of electricity covered by supply contracts between generators and buyers.

According to the ERC, the mechanism allows affected generators and their counterparties to realign contracted energy volumes with actual dispatch conditions during the suspension period. However, the commission said any load exposure arising from the redeclaration would be borne by the coal-fired power plant in favor of its counterparty.

The ERC also maintained the existing settlement treatment for the Kalayaan Pump Storage Power Plant (KPSPP), where transactions will continue to be settled at customer administered price (AP).

The MAP and administered price mechanisms are temporary pricing measures used during abnormal market conditions to help prevent extreme electricity price spikes.

At the same time, the commission authorized KPSPP to claim additional compensation for pumping operations conducted upon instruction of the National Grid Corporation of the Philippines (NGCP), recognizing the facility’s role in maintaining grid stability.

Pump storage plants help stabilize the grid by storing energy and releasing electricity during periods of high demand or supply shortages.

ERC Chairperson and CEO Francis Saturnino C. Juan said the resolution aims to balance market stability and consumer protection.

“This Resolution ensures that extraordinary market conditions are managed in a fair, transparent, and orderly manner,” Juan said. “By clarifying settlement rules and addressing unintended cost exposures, we are protecting consumers from unnecessary price volatility while preserving the integrity of the electricity market.”

The ERC said the guidelines would improve billing accuracy and reduce uncertainty in settlements during market disruptions, helping support more stable electricity pricing for consumers.

The commission added that the measure would also help prevent inefficiencies and distorted market outcomes from being passed on to consumers through higher electricity rates.

For power generators, particularly coal-fired plants, the ERC said the BCQ redeclaration mechanism offers a practical way to manage financial exposure during periods when plants are unable to dispatch electricity due to system constraints.

Do you think stronger market safeguards like the MAP mechanism can help protect consumers from sudden electricity price spikes?

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