DOE assures Visayas WESM implementation

MANILA, Philippines - The Department of Energy (DOE) is confident of implementing the wholesale electricity spot market (WESM) in the Visayas.

“We really need to establish WESM Visayas as soon as possible,” Energy Secretary Jose Ibazeta said.

Ibazeta said the DOE is now conducting a series of public consultations and hearings to enable the WESM Visayas to push through within the year.

“We would like to see WESM in the Visayas to push through. Our timeline is within the year,” Ibazeta said.

Ibazeta believes that it would be better to go straight to the establishment of WESM Visayas than go through so-called Visayas Supply Augmentation Auction (VSAA).

The VSAA hopes to address the growing concern for the tight power supply in the Visayas, specifically in Cebu, Negros and Panay. 

VSAA is a voluntary program which allows distribution utilities and large consumers of electricity to boost their supply deficit through a transparent and competitive means much like the electricity spot market in Luzon.

The program offers a number of options for distribution utilities for the procurement of power. 

This includes purchase of supply deficit from another supplier thru the VSAA apart from their existing bilateral contracts as well as voluntary load curtailment. 

The successful launch of the VSAA is envisioned to allow for a smooth transition to the operation of the Visayas Commercial Operations Program of the WESM which is expected to encourage possible investors to venture in the Visayas power industry, thus bringing in the competition necessary for the region.

The WESM began commercial operations in Luzon in June 2006. It is a centralized venue for buyers and sellers to trade electricity as a commodity where its prices is based on actual use (demand) and availability (supply).