WESM operator seeks review of IEMOP
By Myrna M. Velasco – June 14, 2022, 5:47 PM
from Manila Bulletin
The operator of the Wholesale Electricity Spot Market (WESM) is asking the Department of Energy (DOE) to review the circular which created the Independent Electricity Market Operator of the Philippines (IEMOP) to resolve its position once and for all.
In a statement to the media, IEMOP President and CEO Richard Nethercott said the government should revisit DOE Circular No. DC2018-01-0002 and to “reassess the viability of maintaining the two-entity set-up of the WESM operations and governance.”
“We are not unmindful of unfounded criticisms that have effectively demoralized our personnel,” he said.
Nethercott further asserted that “IEMOP will abide by whatever policy the DOE establishes—even one that amends or altogether supersedes the very policy effecting the transition of WESM operations to IEMOP.” The current DOE leadership has just two weeks in office before the Marcos administration will take over.
While branding the questions on IEMOP’s legality and its current leadership as malicious and groundless, Nethercott indicated that “IEMOP has no vested interest in WESM operations,” adding that “we have a mandate (and) we are faithfully performing that mandate.”
He further opined that “the policy that led to the transition of WESM operations to IEMOP was never questioned before our courts” and that the DOE circular “unless revoked or superseded by subsequent legislation, is valid and binding on all energy participants.”
IEMOP emphasized that “even the ERC, which has since refused to acknowledge IEMOP, has never questioned the circular.”
IEMOP added “this transition was endorsed by the electric power industry participants, while the Energy Regulatory Commission (ERC) and the Joint Congressional Energy Commission (JCEC) were notified and were present at the WESM operations turnover ceremony.”
The spot market operator similarly claimed that its operations of the WESM has not resulted in any increase in the budget for WESM. Instead, the ERC-approved fees to be collected from trading participants had gone down in years 2019 and 2020.
“Contrary to accusations that it had either contributed to or occasioned higher power costs, IEMOP had significantly lowered the cost of market operations since it took over the WESM in 2018 — it saved P58.295 million in 2019 and P68.199 million in 2020 — reduced the total market transaction fees in the WESM, and has consistently operated the WESM up to industry standards,” IEMOP stated.
On record, the market fees being collected for WESM is being approved by the ERC through the filing of the Philippine Electricity Market Corporation (PEMC), which is the duly recognized governance body of the spot market.
