DOE mulls schemes to hasten electricity spot market

Energy Secretary Vincent S. Perez said yesterday they still have to decide on the scheme to be used to facilitate the setting up of the first wholesale electricity spot market (WESM) in the country.

"We are still exploring three options. We have not yet firmed up what to do with it (WESM). The Transco (National Transmission Corp.) board will still meet on this issue," he said.

Perez said the three options are: Re-bidding of the interim market management system (IMMS); to look for alternative financing; and skipping the interim WESM and proceeding to the final implementation of the electricity spot market trading facility.

According to Perez, they are still weighing the pros and cons of each option. "We have to study it very carefully," he said.

His statement comes after Alston Philippines Inc. country president Gilles David cautioned the government against the possible California-like power crisis happening in the country should the interim or test period for the WESM be scrapped.

"We have not decided yet if we will be skipping the interim WESM. It is just one option we are looking at. But I would like to assure the investors that we will study it before making any move," he said.

David, in an earlier interview, said the WESM should pass through the test period to avoid future glitches. "It is always good for a system and its rules (WESM) to be tested first before going through full implementation," David said.

According to David, "it is dangerous if the system will not go through proper verification. It might lead to a California incidence. It is not politically right for the Department of Energy (DOE) not to test the system," he said.

The Alstom official said they are helping the DOE find another institution to fund the setting up of the IMMS.

It will be recalled that the World Bank refused to concur with the decision of the government to award the IMMS contract to Alstom and wanted a re-bidding of the contract.

The government, however, believes that the rebidding of the contract would take time and would delay the implementation of the WESM which was scheduled this month.

Thus, the government just tapped the Asian Development Bank (ADB) for a $30-million loan to finance the overall establishment of the WESM.