Full commercial operation of WESM pushed

MANILA, Philippines - Power plant owners are pushing for the full commercial operation of the wholesale electricity spot market (WESM) to address the concern of power shortage in the future.

Philippine Independent Power Producers Association (PIPPA) president Ernesto Pantangco told reporters over the weekend that if the energy authorities will declare the commercial operations of WESM, it would somewhat encourage more investors to pour in capital in the power industry.

“What I’m proposing is for Secretary Angelo Reyes to declare WESM commercial operations,” he said.

If the fear of spike on prices will be a consideration in the full commerical operations of WESM, Pantangco suggested the lifting of the mandatory 10 percent sourcing of power plants in WESM.

“However, if Reyes is still concerned that it might spike prices, we could have a sixmonth moratorium for the 10 percent mandatory requirements so if you declare WESM commercial operations by January, till June or July, you waive 10 percent mandatory requirement,” he said.

Pantangco believes that this move will help ease the burden of looking for more capacities.

“So we have new capacities coming in. Presumably the supply-demand situation will somehow balance it out. Then you can reconsider in July whether you want to extend it,” he said.

The Cebu Chamber of Commerce has written a position paper addressed to the President (Arroyo) to ask Secretary (Reyes) to declare WESM commercial operations,” Pantangco said. At present, the WESM is only operating in Luzon. Pantangco said the declaration of WESM’s commercial operations will also do away the so-called Visayas Supply Augmentation Auction (VSAA) which has been on the drawing board for months and still not being implemented by the Philippine Electricity Market Corp. (PEMC). PEMC operates the WESM.