Demand from retail electricity users declines during lockdown

By Adam J. Ang – May 31, 2020 | 7:59 pm
from Business World

POWER consumption of retail customers at the Wholesale Electricity Spot Market (WESM) fell drastically as their businesses were shut during the quarantine period.

The Independent Electricity Market Operator of the Philippines (IEMOP) noted that spot-market customers bought a total of 5,540 gigawatt-hours (GWh) of electricity at P1.50 per kilowatt-hour (kWh), in the April billing period, compared to 6,111 GWh in March, priced at P2.47/kWh.

“Both Luzon and Visayas customers, most of them were not operational during the ECQ (enhanced community quarantine),” IEMOP Chief Operating Officer Robinson P. Descanzo told reporters in a briefing last week.

The market operator said the highest daily metered quantity of electricity bought by retail customers at WESM Luzon at 27,190 megawatt-hours (MWh) in April was 44% lower compared to March.

The spot market in the Visayas saw a 66% drop in the minimum daily metered quantity bought by retail customers in April at 1,116 MWh.

Retail customers, who are mostly from the manufacturing sector, are those sourcing at least 1 megawatt of electricity from suppliers.

IEMOP also saw the maximum daily metered quantities in MWh bought by wholesale customers in April to have reduced in both the Luzon and Visayas markets, down 14% and 10%, respectively.

Both retail and wholesale market customers buy most of their electricity from suppliers via bilateral contracts, while around 10% are from spot volumes.

As of December 2019, 1,408 contestable customers, or those holding an Energy Regulatory Commission certificate of contestability, are registered with WESM. Most of them or 735 registrants are involved in commercial businesses, while the rest are from the industrial sector.

There were 70 retail electricity suppliers registered with the market in 2019.

“Compared sa 2019, ang summer months natin mababa ang mga presyo because mababa ang demand (Compared to 2019, prices during the dry season this year dropped due to lower demand.)” Mr. Descanzo said.

Usually, prices rise at WESM during the dry months of March to May as businesses consume more power but supply is tight because power generators are usually running at capacity, except for hydropower plants, which contribute less electricity.

During the lockdown period from mid-March to May 15, power plants in the country generated 8,671 MWh on average, lower compared to an average of 10,394 MWh recorded before the quarantine phase. The decline in output was due to the lower system requirement.

“Overall, during the ECQ period, bumaba iyong demand natin (demand fell) by almost 15% compared to the pre-ECQ levels,” he said.

The strictest form of lockdown was lifted in some areas by mid-May. Starting June 1, most parts of the country will be under modified general community quarantine, the most permissive of the quarantines thus far.