ERC looking into electric coops’ large exposure to spot market

By Manila Standard – June 23, 2024, 7:05 pm

The Energy Regulatory Commission said it will act on the pending applications of distribution utilities (DUs) and electric cooperatives that have a huge exposure to the volatile Wholesale Electricity Spot Market (WESM) to mitigate the impact to consumers.

“Over the last two months, during the heat wave and the subsequent red alerts, we realized also that there were a lot of DUs, primarily electric cooperatives that were almost 100-percent WESM exposed,” ERC chairperson Monalisa Dimalatna said.

She said the ECs do not have bilateral contracts “where the price is locked in and where the supply is assured.”

Dimalanta said the ERC monitored about 30 DUs with varying exposures to the WESM, the trading floor of electricity, from 100 percent to 25 percent.

“We looked if they have pending power supply agreements for our approvals, and if they asked for provisional authority. Some of them fall in this category, so they have pending PSAs, meaning, the delay is on ERC. The ERC is the one that’s delayed,” she said.

“We were able to use this, and we were able to respond to several, particularly those 100-percent to 90-percent covered DUs, so that they will not be exposed to WESM. Hopefully, for the next few months we will be able to clean that list and address them accordingly,” Dimalanta said.

The ERC found that of the 58 DUs with more than 20-percent exposure to the WESM, 25 are located in Luzon, 21 in Visayas and 12 in Mindanao.