Power spot prices rise in early March

By Sheldeen Joy Talavera – March 26, 2024 | 9:07 pm
from Business World

BW FILE PHOTO

ELECTRICITY spot market prices rose in the first two weeks of March as the margin between supply and demand narrowed, the Independent Electricity Market Operator of the Philippines (IEMOP) said.

“This is attributable to a thinner margin and there have been some spikes, particularly in the first week of March, which is attributable to some planned and forced outages in Luzon and the Visayas,” Chris Warren Manalo, assistant manager of IEMOP’s market simulation and analysis division, said in a briefing on Tuesday.

The average price of electricity at the system-wide Wholesale Electricity Spot Market (WESM) increased to P5.46 per kilowatt-hour (kWh) from P4.03 per kWh previously.

Supply was 18,956 megawatts (MW), higher than the 18,818 MW posted during the preceding period. Demand increased to 13,185 MW from 12,372 MW, narrowing the supply margin by 19%.

“This drop occurred despite an average supply increase of 138 MW,” the IEMOP said.

Mr. Manalo said rising prices during the first week of the month were due to the planned and forced outages from several power plants.

IEMOP said that the planned outages, mainly from large conventional generators using coal, natural gas, geothermal, and hydroelectric power, combined for a capacity of 2,724 MW.

Forced outages took out 1,062 MW, largely from coal and natural gas plants during the same period, it added.

For Luzon, the average spot price rose to P5.26 per kWh from P3.97 per kWh previously.

Supply fell to 12,851 MW from 13,060 MW, while demand rose to 9,367 MW from 8,831 MW in the previous period.

The WESM price in the Visayas was P6.26 per kWh, up from P4.58 per kWh in the previous period.

The region’s supply stood at 2,413 MW, higher than the 2,209 MW earlier. Demand climbed to 1,867 MW from 1,742 MW previously.

The full operations of the Mindanao-Visayas Interconnection Project (MVIP), which can export excess power of up to 450 MW, has “significantly improved” supply security in the Luzon and the Visayas power grids, IEMOP said.

The MVIP allowed an average of 341 MW to be exported to the Visayas while the Leyte-Luzon high-voltage direct current link connecting the Visayas to Luzon provided an additional 296 MW.

“Mindanao, technically, has no problem when it comes to supply since the Mindanao grid has a lot. So, the excess capacity helps to augment the capacity needed in the Visayas and Luzon grids,” Mr. Manalo said.

The average spot price in Mindanao was P4.20 per kWh, up from P3.71 per kWh in the preceding period.

Supply rose to 3,692 MW from 3,548 MW, while demand increased to 1,951 MW from 1,800 MW.

IEMOP operates the WESM, which is where energy companies can buy power when their long-term contracted power supply is insufficient for customer needs.