The Energy Regulatory Commission (ERC) has ordered the suspension of the Wholesale Electricity Spot Market (WESM) across all major grids, as regulators move to contain supply risks and price volatility triggered by global fuel disruptions.

The suspension, which took effect at 5AM on March 26, 2026, covers Luzon, Visayas, and Mindanao and follows the issuance of Executive Order No. 110 declaring a national energy emergency. The ERC said the directive was also based on a recommendation from the Department of Energy (DOE) to halt spot market operations amid escalating geopolitical tensions in the Middle East.

With the spot market offline, the country’s power system will shift to Special Operating Guidelines issued by the DOE. These measures prioritize the dispatch of renewable energy, conserve limited fuel supplies, and establish interim protocols for grid operations. 

Market operators, including the Independent Electricity Market Operator of the Philippines and the National Grid Corporation of the Philippines in its system operator role, have been directed to comply.

To replace market-based pricing, the ERC will implement a Modified Administered Pricing mechanism during the suspension period, with final rules targeted by April 1. The proposed framework adopts a technology-specific pricing structure, with coal plants paid at fixed rates, natural gas plants based on contracted prices, and renewables such as hydro and geothermal prioritized under administered pricing. Oil-based plants will be compensated based on administered prices when dispatched or under contract.

The Commission said the adjustment is necessary because historical market prices—typically used as benchmarks—no longer reflect current conditions marked by volatile fuel costs and supply constraints.

The ERC said the approach aims to balance consumer protection and generator viability, ensuring continued plant operations while limiting exposure to price spikes.

“In times of global energy disruption, our priority is clear: to protect Filipino consumers while ensuring that our power supply remains stable and reliable,” ERC Chairperson and CEO Atty. Francis Saturnino C. Juan said. “The temporary suspension of the WESM and the implementation of a modified administered pricing mechanism are necessary measures to cushion the impact of volatile fuel prices and safeguard the integrity of our power system.”

The suspension will remain in place until regulators determine that conditions allow for the safe resumption of normal market operations.

What are your views on the suspension of WESM and the shift to administered pricing—will it stabilize supply or distort market signals?

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