The Philippine Electricity Market Corp.’s (PEMC) board of directors has approved the creation of an independent market operator (IMO) to run the Wholesale Electricity Spot Market (WESM) starting June.
In a statement, PEMC said the operator would be a non-profit company, independent of government and industry players, that shall take over WESM’s management from PEMC, which shall remain the spot market’s governing body.
As part of preparations for the transfer, a special meeting among market participants is set for Tuesday. It shall tackle the composition of the PEMC membership; the finalization and approval of amendments to the electricity market’s articles of incorporation and by-laws; and the selection of IMO incorporators and initial board members, based on the submissions of the PEMC board and transition committee.
PEMC and the IMO shall sign by the second quarter an agreement formalizing the turnover of the use of the Market Management System and other trading platforms.
“This has been long overdue; it has been delayed for more than a decade. Now is the best time to usher in its independence, as provided in the law,” Energy Secretary Alfonso Cusi told the PEMC board.
The approval came 16 years after Republic Act 9136, or the Electric Power Industry Reform Act of 2001 (Epira), was implemented. This law mandates that the entity operating WESM shall be autonomous and made up of the DoE and representatives from the power industry.
But PEMC has been operating the spot market since 2003.
PEMC is a non-stock, non-profit corporation that was incorporated in November 2003 upon the initiative of the Department of Energy with representatives from the various sectors of the electric power industry to be WESM’s governance arm.
The spot market is a centralized venue for buyers and sellers to trade electricity as a commodity where its prices are based on actual use (demand) and availability (supply).
It started commercial operations in Luzon in June 2006 and in the Visayas in December 2010.
In June 2013, PEMC integrated the Retail Competition and Open Access (RCOA) into the WESM.
Lagareon, J. S. (February 3, 2018). New WESM operator approved by PEMC board. The Manila Times. Retreived from http://www.manilatimes.net/new-wesm-operator-approved-pemc-board/377989/