WESM system enhancements eyed
By Myrna M. Velasco – December 26, 2021, 9:30 PM
from Manila Bulletin
The country’s Wholesale Electricity Spot Market (WESM) will be undertaking enhancements on its new market management system (NMMS) so it can accommodate the registration of more participants that will be joining the lowering of threshold of the Retail Competition and Open Access (RCOA) policy in the restructured electricity sector.
According to Engineer Robinson P. Descanzo, chief operating officer (COO) of the Independent Electricity Market Operator of the Philippines (IEMOP), the supplemental budget for the required software and hardware upgrade in the WESM had already been discussed with the Department of Energy (DOE) and the Energy Regulatory Commission.
To recall, the ERC announced last year that the threshold for RCOA or power retailing will go down to the level of 100 to 499 kilowatts (kW) by January next year.
“In our letter to the DOE and ERC, on the lowering of (RCOA) threshold and in preparation for that milestone, there are enhancements that we will need to carry out in our system. So we already informed them in advance that we will need to enhance the software and hardware system to accommodate the additional transactions,” Descanzo explained.
In the RCOA regime of the power sector, the qualified contestable customers in the prescribed threshold can already choose and contract with their preferred power provider and they can also dictate on the price that they want based on the outcome of negotiation with their retail electricity suppliers.
For these contestable customers to be accredited in the RCOA space, they will need to enlist themselves with the WESM because that is the entity duly designated to become the central registration body (CRB) for the retail competition phase of the electric power industry.
On the market system amplification, Descanzo noted that the required adjustments will be on additional storage capacity and expansion of database. This will entail additional funding to be integrated in the application for WESM market fees with the ERC.
He qualified that “in the market fee filing, there’s already a budget that will cover O&M (operation and maintenance) and recurring small capex (capital expenditure)…but often, for major capex, the style of funding is usually via supplemental market fees filing.”
The system enhancement, the IEMOP executive added, can be phased-in “to gradually accommodate the volumes of transaction that we’re expecting. And even if there’s threshold lowering, that’s not exactly one time that could be done in a month, so we can do queuing just to accommodate those that will initially register.”
Next year’s target of bringing down RCOA threshold will also coincide with the plan to introduce ‘aggregation’ in power retailing, although the details of this policy enforcement have yet to be fleshed out by the industry regulator.
The rules for aggregation had not been laid down yet, but Descanzo said they are waiting for the details because it will entail additional market manuals in the spot market.
