Study on Mindanao’s power spot market completed soon

January 19, 2016

THE study on the viability of establishing a Wholesale Electricity Spot Market (WESM) in Mindanao is expected to be completed this year.

Josefina Patricia A. Magpale-Asirit, commissioner of the Energy Regulatory Commission, told reporters that the study of reviving electricity spot market through WESM is ongoing.

The study is being undertaken by the Department of Energy (DOE) and the Philippine Electricity Market Corp. (PEMC), among other involved agencies.

“There is an ongoing study, series of activities such as focused group discussions and forums about the idea of establishing WESM in Mindanao,” she said.

At present, only Mindanao lacks electricity spot market while Visayas and Luzon are into WESM.

WESM is a venue for trading electricity as a commodity.

Engineer Katrina Garcia-Amuyot of PEMC said that “WESM is where the generators sell their excess capacities covered by contracts and where the customers buy additional capacities on top of their contracts.”

According to the PEMC website, the establishment of the WESM “is part of the package of electric power industry reforms mandated in Republic Act 9136, or the Electric Power Industry Reform Act of 2001 (Epira).”

It is seen to create options for electric cooperatives in terms of buying power at any given time of the day, acknowledging the need of intermittent and unscheduled supply which they can easily get if there is a market rather than being locked up to long term contracts.

Meanwhile, Romeo M. Montenegro, director for Investment Promotion and Public Affairs of Mindanao Development Authority (Minda), said that as Mindanao is entering into a regime of excess supply, the assessment to look at the viability of establishing a WESM on the island is now more feasible.

He said with the entry of big power plants in Mindanao, with a combined capacity of 1,920 megawatts (MW) from all committed power projects, they are looking at transitioning from Interim Mindanao Electricity Market (Imem) to WESM. These power projects are expected to start operations etween this year until 2018,

Montenegro pointed out that previously, the viability of Mindanao to have an electricity spot market is the interconnectivity of the island’s grid to Luzon and Visayas, which are already WESM operated.

“Previously that is the notion, before having the spot market, Luzon, Visayas and Mindanao grids need to be interconnected but based on what we have seen in the current trends of the supply scenario and the contracting capacities of several electric cooperatives, we saw that we can have WESM, should the supply be more than stabled even without the interconnectivity,” he said.

But he underscored that without interconnectivity, generating companies cannot sell beyond Mindanao.

“It is going to be more viable if we are all be part of the larger market which is Luzon and Visayas so that our generating companies can sell beyond Mindanao. But I think there is a moving forward to that because National Grid Corp. of the Philippines (NGCP) had already proposed for the interconnection project,” Montenegro said.

The NGCP is currently looking at other possible routes for its planned interconnection project.

Lawyer Cynthia Perez-Alabanza, NGCP’s head of corporate communications and public affairs department, announced last May of 2015 that they are looking at setting up the linkage between Negros-Zamboanga Interconnection Project (NZIP).

The Negros Island and Cebu are also being considered as alternate areas for the connection.

This is after the original plan for the establishment of underwater cables to be set up between Leyte and Surigao del Norte did not push through, as the route was found to have volcanic activity and presence of faults and some technical hurdles because of the very deep trench that the project may traverse.

The interconnection project is among the proposed projects under the Mindanao Energy Plan 2012-2030.

Published in the Sun.Star Davao newspaper on January 19, 2016.  

By Ace June Rell S. Perez


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