Average power spot market price climbs by 22%–IEMOP

BY LENIE LECTURA – DECEMBER 22, 2021
from Business Mirror

The average spot price of electricity on the Wholesale Electricity Spot Market (WESM) as of December 18 went up to P6.32 per kilowatt hour (kWh) from November’s P5.17 per kWh.

The Independent Electricity Market Operator of the Philippines (IEMOP) said Tuesday that the P1.15 increase was due to the thin supply margin caused by forced and planned outages of major power plants.

During a news briefing held Tuesday, IEMOP officials attributed the 22-percent increase to the power outage incidents in coal and gas plants and the impact of typhoon Odette (international code name Rai).

“The Visayas grid was disconnected from the Luzon grid [due to] the typhoon. As a result, higher prices were observed in Luzon, which triggered the application of the secondary price cap on December 17,” said Eryl Jansen Gregana, IEMOP market simulation and analysis senior specialist.

The Energy Regulatory Commission (ERC) has suspended WESM operations in Visayas as of December 16. IEMOP said Administered Prices (AP) shall be used for the suspended intervals. Currently, the indicative AP for this period is around P4.6 per kWh. Real-time data from the System Operator showed a demand of around 833 megawatts (MW) as of 10:30 a.m. of December 21.

“Administered prices will still be implemented in Visayas because of the market suspension. Other than that, absence of transfer between the grid, prices went up due to generator outages in Luzon,” added Gregana.

IEMOP Chief Operating Officer Robinson Descanzo said some 400MW of capacity was not transmitted to Luzon. “The 400MW that was not produced by Leyte and was not transmitted to Luzon, we utilized other generators in Luzon. I think this is partially the reason why prices went up in Luzon. Also, there were major power plants that went offline.”

Despite the thin supply margin recorded, IEMOP said demand fell to 9,559 MW from 10,379 MW due to the cooler weather. The same trend was also observed for the system and regional peak demands.

As of December 15, IEMOP reported that system peak demand was recorded at 12,096 MW or 579 MW lower than that of the previous month. On a larger scale, the annual system peak demand of 13,752 MW increased by 4.34 percent or around 571 MW. As for the regional peak demand, Luzon peak demand declined to 9,999 MW this December from 10,550MW in November while peak demand in the Visayas also slid to 2,135 MW from 2,154 MW.